The article by Edward Lucas on his experience trying to sort out his affairs with two DC plans (Options and Scottish Widows) has focussed attention to Mr Lucas’ attempts to get his pots in the same place. I don’t know who “Outsider -looking- in” is but he sounds authoritative but the rules he’s referring t, rightly infuriate the consumer Lucas. Whether it is Scottish Widows or MoneyHelper , he can’t do what he wants to do with his money.
Pension Bee have been calling for some sense on transfers so that people have some control over their money and this is one of the reasons why. I guess that there will be people who will be saying “rules are rules” but there seems no sense in all this.
There is of course a sense that advice is always worth paying for but most of us want advice on complicated things, not how to bring two pots together. If pots can’t be brought together without the expense of an adviser then the aim of regulation to put the customer in control has failed. It seems to have failed and we may blame scamming but … read beyond John Mather’s comment which shows how idiotic disclaimers are. Advice is not required…
With the best will in the world, the regulations that were put in place to solve a problem have become the problem – I suspect irony from John Mather but this isn’t funny, there are millions of people who need to do the simple things that Edward Lucas can’t.
And finally an anonymous commentator who clearly knows a lot about working within MoneyHelper.
Statements about regulation doesn’t mean there is no problem.
His scheme may well have said
“It’s a legal requirement on all transfers that MoneyHelper agree it’s ok”.
I’ve heard that so many times from so many customers of so many different schemes I’m sure that many are saying that to customers. But I’m also sure that often the scheme has understood the rules and purpose but explained it badly and consequently customers often see the scheme as delaying a transfer.
Rules layered on rules, and state pension changes, make pensions confusing and get seen as a rip off since it can be so difficult to move/withdraw your own money.
Ironically extra protection potentially leads to an increase in scam activity
“Don’t worry – we can sort all of it for you – just sign here”
Also people will often invest in property as they see it as a sure thing, and miss out on the tax breaks that pensions enjoy.
MoneyHelper used to offer some specialised support for the self-employed who are often un-pensioned, but the relaunch has been delayed.
None of this speaks well of Moneyhelper. Is is really playing an important part in the way we manage our pension affairs?
My gut tells me that MoneyHelper has become more harm than help to the millions who are trying to make sense of their pensions.
It has the role of delivering the dashboard which is undoubtedly good and going to happen. But is it doing much else for pensions?
Yesterday the performance of a number of large funds produced returns below inflation. Did any of these pass the VFM test?
Advice has been reduced to navigating the bureaucracy and little to do with adding value beyond inflation. What can we learn from those who consistently produced real excellence in terms of long term returns?
The evidence suggests that achieving top-quartile, inflation-beating returns requires:
1. Deep Knowledge Over Breadth: Focus on 10-20 positions you thoroughly understand rather than superficial knowledge of 100+ holdings
2. Quality Over Cheapness: As Munger taught Buffett, investors should seek “wonderful businesses at fair prices” rather than “fair businesses at wonderful prices”
3. Conviction and Patience: As Munger stated, “The big money is not in the buying and the selling, but in the waiting”
4. Sector Selection: During inflationary periods, favor energy, real estate, and companies with pricing power and operating leverage
The research conclusively shows that while broad diversification protects against catastrophic loss, it also guarantees mediocrity. Top-quartile investors consistently demonstrate that concentrated portfolios of 10-25 carefully selected, thoroughly understood positions in quality businesses can significantly outperform inflation and broader market indexes over the long term. However, this approach requires exceptional research capabilities, emotional discipline, and the temperament to withstand volatility—qualities that Buffett and Munger possessed in abundance.
I agree that the regulations are sometimes prompting calls with MoneyHelper where this is trivial risk of a scam. But I disagree with the statement “that MoneyHelper has become more harm than help to the millions who are trying to make sense of their pensions.”
MoneyHelper will always attempt to add value within any interaction. Often a call prompted by a transfer will lead to a conversation about state pension, retirement planning, tax etc.. Very, very, often customers will be grateful for some independent impartial guidance, even those who, like Edward, initially view the call as an unnecessary delay and waste of their time.
MoneyHelper provides a wide range of services which help to bridge the gap between the public’s need for help and the full advice offered by a regulated adviser. A service which is genuinely highly valued by those who use it.