Six out of ten Americans hold “new age” beliefs and I doubt it’s much different in the UK. I have never- NEVER – heard a financial services firm openly prey on our superstition, but irrational behaviour underpins most of our decision making, my mates who structured CDOs – talked of their craft as alchemy and – if our Prime Minister is to believe, he will reincarnate tonight from a ditch near Downing Street.
It being Halloween, it is a good time to celebrate the irrational and perhaps we can refer to my favourite image of a pension pot – supplied by the Sun – to remind my super-rational colleagues that most people regard their retirement savings as at best mysterious and at worst a witches brew.
So why are we so mystified. Read the head lines above and see what matters to the Sun.
- Avoiding high charges
- Avoiding being scammers
- Seeing all their money in one place
Mr Money and I did some work on this last year and yes it was around Halloween and yes it picked up on people’s fear of the irrational.
But – and this is what us rational masters of the pensions universe – fail to understand.,,, people see the pension experts as the vampires, and it’s their blood we’re sucking.
Superstitious -or suspicious?
People are in love with the supernatural, halloween is a bonanza for retailers and tonight I will be partying with the best of my colleagues at WeWorks with my wizard hat.
Tonight we celebrate the unknown forces of darkness, the other.
Today on the other hand I will be explaining to my friendly investors their AgeWage scores- which they got this week. Those who have scored well have been keen to publicise their investment genius.
Just got my @agewageuk scores for my pensions, via @henryhtapper‘s new venture. Both rate above average on value for money (yay!) but now wondering where I could do better! #pensions #retirementsaving
— Faith Archer (@MuchMore_Less) October 30, 2019
While those who have found their pots have got less than 50/100 on the AgeWage scoring scale have been darkly muttering at me, like I was Gandolph.
Actually – our scores are super-rational, they don’t pretend to predict the future, but they tell people about the past. They are the evidence of the costs and charges , the risk and reward and the skill or ineptitude of managers. They are the evidence of the impact of switching funds or sticking with the default. They are the evidence of decisions to use a workplace pension or switching to a SIPP.
In short, we empty the pot to show whether the witches brew is a retirement elixir or the contents of a fetid swamp.
For the superstitious, a pension can be entrusted to the alchemic powers of active management. For the suspicious, a pension must prove itself by its outcomes.
I’m on the side of suspicion and I’m for evidence- based investing, for accountability from those who manage and profit from my money. I am done with superstition and will promote transparency going forward.
If you want me to test your pension pot and give it an AgeWage score – contact me at email@example.com and we’ll tell you how you’re really doing.
When you believe in things – that you don’t understand
Then you suffer – superstition ain’t the way.