I am a fan of Richard Smith and all he is doing to help people get back control of their financial lives using dashboards. Like me he believes that pensions should be laid out as pensions not pots and I feel exasperated for him that he spent yesterday listening to what was irrelevant to his central belief  which he expounded in his talk promoted above and available from this link.

Richard Smith found himself for four hours listening to the Lords debating asset allocation in what was for him an interminable debate that did not end as it ate the first debate on the DC aspects of the Pension Schemes Debate.

He wants to get to the debate on Guided Retirement on how to spend your DC pot but he’s going to have to come back on February 3rd.

And a frustrated Richard Smith explains why he wants people to get to grips with their finances (presumably with the help of the pension dashboard). Using the dashboard to get the full picture I agree with. (I assume MHPD stands for MoneyHelper Pension Dashboard).

But there is a school of thought that would have us speak with an extension of MoneyHelper before making decisions. This was the idea behind “Guaranteed Advice” offered by George Osborne in his 2014 Budget speech to ensure we knew how to deal with Pension Freedoms. It hasn’t worked, the FCA’s work on decisions being taken at retirement show we are making a total mess of pensions. I reported on this in May last year and you can read the 2024 Financial Lives (pensions) Survey and my comments here.

To me this cock up we are making on pensions, just gives gist to the argument that people should be paid default pensions unless they opt out for pension freedom. I suppose that over time the simplicity and effectiveness of CDC will win through and that progressive employers will not wait till the end of this decade to get involved.

Guided Retirement is an aspirational policy that simply can’t be fulfilled unless we invest the money that is needed to pay people pension. If we can get 60% more from going collective, we should concentrate on delivering that (in CDC) not waiting for the Lords to opine on engagement and choice.

I’m in my 42nd of year advising on pensions and I have never been clearer, pensions need to be paid to people , choices need to be kept to a minimum and they need to be laid out in a way that people understand.

Do we want to opt out of having a pension paid to the person financially dependent on us if we die first?

Do we want to delay or bring forward the pension being paid to us?

Do we want to opt out of pensions for a pot that gives us pension freedom ?

These are legitimate questions. But to suppose that we must be guided to an outcome that most suits us is to assume that we are all wanting different things. Most people see a pension as something that is paid to them to replace payment from their work and if it is insufficient for their aspired lifestyle it must pay a part of their work.

Here’s Richard’s post before he made his way to the debate (that didn’t quite happen).

I hope that on Feb 3rd ( a week today) , Richard will get what he wants and a ratification of the MoneyHelper Pension Dashboard. I hope he does not get another debate on pension freedoms and the need for ordinary people to consider their pensions as pots of wealth.