Do you want to advise BSPS members in their “time to choose”?

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This blog is for financial advisers, though anyone, including BSPS members, may find it useful.

Financial advisers are urgently required by these members who are in their “time to choose”.

There are two self-help groups for BSPS members. One is for all members and the other specifically for the 42,000 people in the scheme who have not drawn their pension. It is the latter group who have most need of financial advice

Along with Al Rush, Angie Brooks and John Ralfe, I have the opportunity to see the questions , hear the moans and provide input to the online self-help communities that have been created by two British Steelworkers from Teeside (who deserve a lot of praise).

Surprisingly, no-one has  creating a self-help group for advisers to  get up to speed with the issues that members are facing. There are very specific issues surrounding the scheme and its peculiarities which need to be understood if advisers are to properly understand the problem.

Depending on the response to this blog and to work I do this week, I may set up such a group. In the meantime, should you be saying “yes” to the answer posed in the title this blog, please read on and take some action.


Getting up to speed

As a first place to learn about these peculiar matters, I would recommend that you- as financial advisers – thoroughly read all the pages of this website.

If you want to really understand the scheme, you can go to BSPS scheme site, which contains the answers to almost all questions (and a good search facility).

If there is demand, we (Al Rush and I) may run an “advisers webinar” to help with the frequently asked questions you will get when advising.

We intend to provide specific help to the groups and this blog is part of that process. As I and Al  develop these plans, we will share them.


Suitability

At the bottom of this page, I’ve pasted  a checklist on how to choose a financial adviser. Nobody quite knows where it came from or who wrote it. It is being used by BSPS members who are having to make tough choices about their pension benefits. (If you claim it as your work- I’ll credit you).

If you are giving advice, why don’t you check that you can properly answer each of these questions in not more than 50 words?

If you want to help BSPS members. You might want to go a step further and write your answers down and send them to me at henry.tapper@pensionplaypen.com.


Logistics

These are the towns where BSPS members are congregated and BSPS are meeting their members. You might like to think about towns to which you could help members.

 

Scunthorpe

 
 

Walsall

Thornaby-on-Tees
 
Chester
 
Port Talbot
 
Newport
 
Ebbw Vale
 
Workington
If there are towns that you can travel to which are on this list, you might like to send me your selections.
We may need an adviser map to share with BSPS members.

 

So here are the questions we’d like you to think about and respond to (please no more than 50 words per answer – preferably less!)


How to Choose a Financial Adviser

Where to start.

When you decide to see a financial adviser, especially if it is your first contact with them, you should plan in advance by pulling together your relevant paperwork, thinking about your financial goals and preparing a list of questions to ask.

Your adviser will firstly want to understand which products you have, your current financial position, your goals and how you feel about taking risks with your money.

This will help them to recommend a financial plan and products that are right for you now and in the future.

Here are some questions that you might want to ask us before deciding whether to proceed:


Q1: Are you approved by the FCA?

The adviser should be regulated and approved by the FCA with pension transfer permissions.

Q2: Type of advice offered?

Financial advisers can offer ‘independent’ advice, where they can consider products and providers from the whole market or ‘restricted’ advice, which is limited to certain products, providers or both.

Your adviser has to clearly explain if they specialise in certain areas, such as shares, funds, units, insurance products or anything else, and the providers they look at.

Q3: What experience and qualifications do you have?

The FCA has increased the minimum standards of qualification that financial advisers have to meet to ensure their knowledge is up to date.

Advisers now have to be qualified at Level 4 or above of the Qualifications and Credit Framework (equivalent to the first year of a university degree). Level 6 is pension transfer exam for example.

Professional advisers also need to obtain an annual Statement of Professional Standing (SPS).

Ask to see proof of the above if you need proof.

Q4: What are your charges?

It is important to understand what fees and charges you will pay for advice and when you will be expected to pay.

Q5: Do you offer an ongoing service and how much does it cost?

This might be an annual review to check the value of your investments and consider any changes to your circumstances, checking your risk profile, make sure you are not missing tax saving opportunities, improving the tax effectiveness of your portfolio etc.

Q6: How do you assess my financial needs?

Financial questionnaire, your goals and planning etc.

Q7: How will I receive the advice?

Your adviser should send you an outline of their recommendations which is usually called a ‘suitability report’. Check this carefully to ensure it reflects the discussion you had with the adviser and that you understand why they recommended a particular plan or product.

Q8: How often should I review my investments?

You should ask the adviser how often they recommend reviewing your investments based on your circumstances.

Most experts suggest that at least once a year is sensible to ensure your investments are in line with your risk profile.

There are often budget changes that will add or remove tax allowances – it is important to review these regularly to make sure you don’t miss out.

Q9: Who will look after my advice?

Will the adviser continue to see you or another member of the firm? Points of contact if the adviser is off sick, on holidays, leaves the firm or retires.

Q10: How do I know I am getting the right advice?

Does the adviser have external compliance to check their work?

Q11: How do you assess whether a product or investment has the right level of risk for me?

Examples – risk profiling, client experience, timescales and capacity for loss.

Remember – There is no such thing as a dumb question when it comes to looking after your money or loved ones.

you 2

 

About henry tapper

Founder of the Pension PlayPen, Director of First Actuarial, partner of Stella, father of Olly . I am the Pension Plowman
This entry was posted in advice gap, BSPS, pensions and tagged , , , , , . Bookmark the permalink.

9 Responses to Do you want to advise BSPS members in their “time to choose”?

  1. John Mather says:

    Who in their right mind would give advice that needs to guess the outcome of an arrangement where the assumptions that were the basis of the solvency were flawed and the cash flow assumed is no longer available. Where the membership all belong to the poor me apathy party in a jurisdiction that just voted for a smaller economy but may not be happy with their share when the new poverty is distributed. The much used term “risk” has no definition in the rule books but left to be determined, with the benefit of hindsight, in complaints where selective amnesia is not punished.

    So the advice to the IFA the risk/reward is not worth it so do not give advice but do pontificate offering only where to get guidance from the excellent services already available and funded by the tax payer. Pass the poison challace don’t drink

    Like

  2. Gerry Flynn says:

    Henry
    Not sure why Thornaby on Tees is on the list but Redcar is not when it should be considering they lost there steel plant 2 years ago and with it thousands of jobs.

    Like

  3. Brian Gannon says:

    Your intentions are laudable Henry but unfortunately far too late in the day. The process for advising on DB transfers and incorporating an accurate TVAS report takes far longer than between now and December 11th. Unless of course you go down the route of formulaic non-individual advice which you quite rightly criticise in other blogs. In practice the existence of a 3 month guarantee period is there to acknowledge the time taken to give professional tailored advice. I like your approach but it is far too late in the day to organise this service for anything but a small minority of members. Even if you had a list of advisers by the end of this week, only a very small minority of the 42,000 affected members would get in touch and most of those would not be able to provide the information needed to enable the adviser to give advice. And advisers who are offering advice on DB transfers/non transfers are already swamped with demand. Good luck, but unfortunately this is not an area where financial advice can be delivered for any but the few in such short timescales.

    Liked by 1 person

    • stefan says:

      Brian, Appreciate your point but the decision on transferring out does not need to be taken by Dec 11 – that is only BSPS (PPF) or BSPS2. BSPS does not cease to exist until March 28th so anyone getting their CETV now has the full three months. Also there is a case for asking for an extension as the members are having difficulty finding IFAs who can give sufficient time – many local IFAs are overloaded by the requests in these clustered localities.

      Liked by 1 person

      • Brian says:

        Hi Stefan, thank you for the clarification. I wish everyone well. But even if the deadline were extended to December 2020 there would not be enough time for AF3 or G60 qualified advisers to do a proper job for more than a minority of those seeking advice about their BSPS options. Each person seeking advice would need properly personalised advice. To give such advice requires a lot of time and effort. And also requires proper buy in and involvement from the member seeking advice. It does not surprise me that so many of Henry’s anecdotal stories involve the member not having a clue about the reasons and facts behind their decision to transfer. Whilst one could take the view that this is the adviser they saw’s fault, I wonder why one would not also take the view that they as the individual affected should take responsibility for making sure they understand things. There is too much of a tone of blame the adviser. I am sure there are a lot of bad advisers who do not do the job properly, but I also believe that each member of the scheme has a responsibility to themself and their family to understand the pros and cons of their decision. There is too much of a blame the advice and blame the adviser culture in our society, and whilst this may be justified in some instances or even many instances, there is also a very great tendency for people to simply forget the reasons behind their decision once it has been made. I got an A for Mathematics in my O level, but I can’t remember any of the questions or any of the answers to those questions. Once we no longer need to know the reasons behind complex decisions we as human beings simply choose to forget them. We clear our minds to focus on living the rest of our lives once we have made a big decision. It is what humans do.

        Liked by 1 person

    • Matt Richards says:

      I believe members can transfer out up until the scheme finishes in March, and after that they can transfer out of BSPS2 if that is the option they have selected.

      Many members are yet to receive CETVs and can request them up to Dec 11th. They then have 3 months.

      I’m not sure if they can request CETVs after this, someone may wish to confirm.

      Liked by 1 person

      • stefan says:

        Members can request a CETV at any time from BSPS and the BSPS2. No transfer requests are possible from PPF. However, a member who gets a CETV in February will have their transfer honoured by BSPS2 and PPF up to the end of the CETV validity.

        Liked by 1 person

  4. henry tapper says:

    Thanks to Stefan for clarifying this. The essential message is – don’t hurry your decision – make sure you’ve done your research both on the advice and adviser and be sure that you consult your family – if you’re lucky enough to have one. This is a big decision.

    Like

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