"Daybreak confusion over pensions today – apology" blog discussion
edited 15 February 2011 at 12:09PM
in Martin's Blogs & Appearances & MoneySavingExpert in the News
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What absolute nonesense - most of the comments floating around from professional advisors haven't actually watched the broadcast - they're responding to a twitter message which misrepresents what was said or a bizarre piece of over-hyped reporting on a trade press website (sparked by the same twitter). Those who have actually seen it are not singing the same tune (and if they are I can't understand why).
You say there was an error - what was the error? I answered the quetion asked, sadly I can see in hindsight the question was ambiguous and that's the issue here.
Thankfully to counter some of the ridiculous notes that have been written (mostly elsehwere) I've had a lot of positive comments from IFAs and pension specialists emailed in saying this is nonesense and the fuss being made is embarassing for the industry.
As for annuities, its one of the key areas where i ALWAYS tell people they should get independent financial advice, I never have or will suggested what annuities to get other than don't just get your pension companies - and even though i feel like changing my view on that today, I won't as its the right move.
That's an important and valuable message I never ever talk about individual products - yet again that wasn't what todays broadcast was about - did you actually take the time to watch it before writing this? This was a simply warnign about price changes - and I think i did that rather effectively judging by what those who aren't navel gazing are saying.
Please note, answers don't constitute financial advice, it is based on generalised journalistic research. Always ensure any decision is made with regards to your own individual circumstance.
On Daybreak's website http://!!!!!!!.com/4zdtjod you say:
"When you retire, if you have a private pension fund most people need to transfer it into an annuity – a product that pays a set amount every year until you retire."
This is just not at all accurate.
I posted on that having not seen Daybreak and the clip in question. Someone posted a link to it and having now seen it, then whilst there is an error, the speed at what it was said and the lack of correction means that almost certainly the average daybreak viewer would not pick up on it. The coverage of this error is over the top. However, it is understandable given that those that are authorised to give advice would not get away with it. Yet journalists can. I think that it is that issue and the opportunity to raise it that is giving it the coverage. Rather than the error itself.
I was actually more disappointed with the response: "There are lots of "what-ifs" but I’m not going to play that game to defend myself. This is a complete red herring; this is Daybreak, not Citywire. I have got four minutes to get my point across. - That gives an indication that just because the time is short and the audience low knowledge that you can get away with it.
"When you retire, if you have a private pension fund most people need to transfer it into an annuity – a product that pays a set amount every year until you retire."
Clearly wrong. Annuities pay out after you retire and not necessarily a set amount and not necessarily until death (which may have been what he meant).
Saving change in money box.
That is clearly not correct but it is a dumbed down answer giving one of the basic options. its a one sentence answer to give an explanation that needs more than one line. I know from past comments from Martin that you have to play to the audience in question and you cant make things too technical. However, with things like this which have multiple options and what you do and dont get depends on the type of income you buy and what options you include, i think that making generalisations can be risky when aiming them at a wide audience.
The key thing here is that anything that Martin says is watched by millions of viewers. The advice given by an IFA is only evidenced by the few in the room, and in the comfort of the write up the adviser can 'correct' anything that isn't 100% clear and very few if any will see the notes subsequently or examine them.
The suggested error is based on a microscopic disection of the words and relates to a section where the context of unisex annuity rates is being explained so it is not even about options at retirement.
It is a true reflection on IFAs like dunstonh if they cannot come to the complete defence of Martin on this one.
Talking of annuity errors look at this annuity advice 'error' by dunstonh. In the thread below a poster asks whether they should take up a single life guaranteed annuity rate and is basically given the impression by dunstonh not to bother with it if they have dependants to look after. However dunstonh fails to point out that taking the single life guaranteed annuity rate on beneficial terms and purchasing separate protection for dependants would be a potential workaround for the original poster saving them £1,000's. It is only when that thought is brought up later in the thread that dunstonh starts to mention it. Now surely that omission is much more relevant in that discussion than the drawdown option is in Martin's appearance. Perhaps dunstonh didn't have the time to clarify or perhaps he thought his audience's understanding was too low?
That's not a criticism of dunstonh on that thread (although it most definitely IS a criticism of his post on this thread), I would like to think that in a full advice interview that would be pointed out. But it does show that if you try to disect every word nobody can be 100% clear about everything and that includes anyone on this board including me, and any professional adviser.
http://forums.moneysavingexpert.com/showthread.php?p=21102361&highlight=#post21102361
Very much appreciate your reply. I agree that the TV slot was not a Pension piece. I've also heard you very clearly state many times that you don't cover Investments on the Radio and TV.
My comments were more aimed at the Media in general, and that if they start covering a topic that encompasses financial advice, they should have some kind of statement suggesting that people should seek financial advice to explore all the options (whether or not they have a Pension/Investment expert on the show). Some of the articles written in Newspapers and shown on TV are very misleading and written by people with very little knowledge, and who are not held responsible for any 'advice' they may have given. This is very frustrating for professional Financial Advisers.
Keep up the good work.
Martin
Martin, I have to say that I think what you do is excellent and provides simple, straightforward information to the public about areas of financial planning that they might have difficulty understanding otherwise. As a qualifiied and authorised IFA with 10 years in the industry I occassionaly make mistakes too. Only yesterday I forgot the cash ISA allowance for this year when discussing a clients investment portfolio. However, when I had realised that I gave wrong information I re-contacted the client and corrected the error. The client didn't start a 'witch hunt' and the errors that you made (and there were several) were no worse than mine. I think it is important thing to remember here is that not all IFA's are the same and most don't feel the need to 'puff out our chests' in disgust at your attempt to actually help consumers!! brianrhill is typical of all that is wrong in the industry (but then he probably works as a'tied' advisor flogging the banks products) and if he is an IFA, shame on him. Our greatest aim should be to educate consumers and you should be applauded for doing exactly that :T