Preparing for the retirement landscape to change forever

It is an exciting time for advisers and for the Later Life Academy as we believe these changes will provide an increase in demand for advice, given the Guidance on offer is likely to leave most individuals with more questions than answers.

The question of where people seek that post-Guidance advice has been much debated and late last year we heard the first details of the Retirement Adviser Directory, put together by the Money Advice Service. Given that MAS ‘advisers’ will not be providing Guidance, it was suggested that the service had been effectively ostracised from the whole process, however nothing could be further from the truth.

In fact MAS is playing a very substantial role in putting together this Retirement Adviser Directory and MAS has been responsible for setting out the criteria to meet in order to secure inclusion. This included:

- Advisers must have the ability to provide regulated financial advice in either the ‘at retirement’ or ‘post retirement’ market.
- Advisers in the directory will offer, as their primary business model, regulated advice.
- As well as ‘independent’ firms, those who are ‘restricted’ can be included in the directory as long as they have chosen to focus on a particular market which is relevant to retirement planning.
- Entry will be at firm level with information about individual advisers who meet the entry criteria also shown.
- Firms listed will be asked to commit to providing an initial, no-obligation meeting either by phone or face-to-face for all customers approaching them through the directory.

We at the Academy have been engaging with MAS on our member firms’ inclusion within the Directory, and indeed, our ‘Guidance +’ proposition fits neatly into the requirements, for example, for a free initial meeting followed by advice and recommendations where appropriate. For this free meeting there does however need to be support from the FCA that this can be a ‘light touch’ focused factfind and report process offering simplicity and clarity for individuals.

The process as outlined, particularly with our ‘Guidance +’ opportunity sitting between the two does allow a seamless movement between Guidance and advice. Therefore, we welcome the Directory and particularly like the fact it will be a brand new entity, not based on anything that has gone before, offering consumers a new era of choice where they will have access to advisers who have a broad understanding of the retirement market.

The criteria seems sound in principle and we agree that all regulated advisers should be welcome to join however would suggest there needs to be checks in place to ensure that those on the Directory are skilled in this sector. In terms of that initial consumer meeting, LLA members will be providing them via telephone or face-to-face, backed up by consumer-facing web delivery.

It is also important that firms register so they can take responsibility and check the competence of individuals within the business, and we actively endorse full disclosure of all fees for any subsequent advice provided which must be fair and transparent at all stages. To this end, we are working to establish a capped range of adviser fees so consumers know that Academy members will be delivering value and clear advice fee limits which will need to be discussed and agreed with consumers at the point of disclosure.

Therefore there is much to welcome in the formation of this Directory and LLA will be working closely with MAS on developing it and ensuring our members take centre stage within it. However, we are under no illusion that there is much to be done between now and April; indeed, the move to these new pension freedoms is simply a starting point and the industry needs to fine tune now how we will deliver that ‘A-Z journey’ where consumers are able to join and leave at any point. It also needs to be supportive and information should be delivered in a language that the end user understands completely and enables them to make the best decisions for their circumstances.

This is a real sea change for the retirement marketplace and therefore we must ensure we are prepared and we have the needs of the consumer at the forefront of the delivery of guidance, ‘Guidance +’ and advice. It will be absolutely vital if we want to achieve the end game whereby clients get the right type of guidance and advice every single time.