Worried about Friends Life pension

zagfles

liffy99 wrote: »

Thanks again for the replies and I quite understand that, from most perspectives, things may have improved rather than been changed (eg my contractual commitments to my pension).
And I appreciate the need for professionals when complex situations arise that require much training and expertise.
But the point I am clumsily trying to make is that products that affect MILLIONS of us should be made straightforward enough to deal with without recourse to professionals.
Sure, if I want to challenge a complex area of litigation I'll see a solicitor, if I want my car repaired I'll see a good mechanic, if I have very complicated financial affairs I'll see an accountant. BUT, my view is that personal pensions (which, let's face it, have been sold on the back of dwindling employer-based DB pensions) are, essentially, CONSUMER PRODUCTS, and should be understandable by the great majority of us without external help.
Sorry if I've offended any pension professionals out there.

Interesting article on the BBC website: http://www.bbc.co.uk/news/business-41159944

I wouldn't be surprised if some IFAs just enter customer data into a piece of software like this and use the output!

dunstonh

zagfles wrote: »

Interesting article on the BBC website: http://www.bbc.co.uk/news/business-41159944

I wouldn't be surprised if some IFAs just enter customer data into a piece of software like this and use the output!

If there is any software that does that, please tell me. It would save hours of work.

zagfles

dunstonh wrote: »

If there is any software that does that, please tell me.

Did you read the BBC article?

It would save hours of work.

It would give you more time to post on MSE

dunstonh

Did you read the BBC article?

I did but that was about robo-advice and that is little more than the equivalent of picking a multi-asset fund and having an app.

It would give you more time to post on MSE

Thats why I employ people.

zagfles

dunstonh wrote: »

I did but that was about robo-advice and that is little more than the equivalent of picking a multi-asset fund and having an app.

Not what it says.

Basically, you answer lots of questions online about your income, expenses, family situation, attitude to risk, and so on, and then the algorithm allocates your savings to a mix of investments, from index funds that aim to mimic a particular stock market index or sector, to fixed-income bonds

Though maybe this IFA used the app you're talking about: https://forums.moneysavingexpert.com/discussion/5553079

Thats why I employ people.

Ah, that explains a lot. One person getting to 89k MSE posts is a bit unrealistic

bigadaj

liffy99 wrote: »

Thanks again for the replies and I quite understand that, from most perspectives, things may have improved rather than been changed (eg my contractual commitments to my pension).
And I appreciate the need for professionals when complex situations arise that require much training and expertise.
But the point I am clumsily trying to make is that products that affect MILLIONS of us should be made straightforward enough to deal with without recourse to professionals.
Sure, if I want to challenge a complex area of litigation I'll see a solicitor, if I want my car repaired I'll see a good mechanic, if I have very complicated financial affairs I'll see an accountant. BUT, my view is that personal pensions (which, let's face it, have been sold on the back of dwindling employer-based DB pensions) are, essentially, CONSUMER PRODUCTS, and should be understandable by the great majority of us without external help.
Sorry if I've offended any pension professionals out there.

Pensions are fairly straightforward, I suppose it boils down to your background, knowledge and ability to read and learn and put some effort in.

The Internet has made a huge impression on financial services, from the ability to pick up large amounts of information and become better educated to the ability to access cheap products and providers, monitor portfolios, build up asset models, project returns etc etc

There's no reason why you can't service your own car, or you choose to use a mechanic, I personally use a garage.

I complete a self assessment tax return, I could pay an accountant to do this, but I'm happy doing it myself.

I've never utilised a solicitor apart from conveyancing, but then again have a decent contract knowledge of civil law and haven't been in a position to have to issue or defend proceedings.

There's certain areas where legislation prevents the amateur from completing their own work, gas appliances and certain electrical works, or transferring a db pension woth more than £30k, these are areas where the risk to the amateur consumer is considered high and total freedom would have adverse consequences for many people.

zagfles

bigadaj wrote: »

Pensions are fairly straightforward, I suppose it boils down to your background, knowledge and ability to read and learn and put some effort in.

The Internet has made a huge impression on financial services, from the ability to pick up large amounts of information and become better educated to the ability to access cheap products and providers, monitor portfolios, build up asset models, project returns etc etc

There's no reason why you can't service your own car, or you choose to use a mechanic, I personally use a garage.

I complete a self assessment tax return, I could pay an accountant to do this, but I'm happy doing it myself.

I've never utilised a solicitor apart from conveyancing, but then again have a decent contract knowledge of civil law and haven't been in a position to have to issue or defend proceedings.

There's certain areas where legislation prevents the amateur from completing their own work, gas appliances and certain electrical works, or transferring a db pension woth more than £30k, these are areas where the risk to the amateur consumer is considered high and total freedom would have adverse consequences for many people.

Yes, millions of people are in workplace DC pensions, which have a default fund allocation if the employee doesn't choose an alternative. Some ask a few simple questions about attitude to risk, expected retirement age, whether they're likely to buy an annuity or go into drawdown etc, and an algorithm constructs a portfolio on that basis. Most providers have tools where you can model predicted retirement income.

There's no reason why what applies to workplace pensions can't apply to personal pensions.

dunstonh

FCA published some stats in its data bulletin for Sept 17.

69% used an adviser when going into drawdown.
57% of individuals chose to use their existing provider for drawdown
(i think this stat doesnt tell us much as many people prepare in advance. Indeed, some providers require the pension to be switched into first and then do the drawdown post sale)

58% of people with GARs did not utilise them (thats not good. not all GARs are great but I would have thought a much lower percentage on the not taken up figure).

https://www.fca.org.uk/publication/data/data-bulletin-issue-10.pdf

zagfles

dunstonh wrote: »

FCA published some stats in its data bulletin for Sept 17.

69% used an adviser when going into drawdown.
57% of individuals chose to use their existing provider for drawdown
(i think this stat doesnt tell us much as many people prepare in advance. Indeed, some providers require the pension to be switched into first and then do the drawdown post sale)

58% of people with GARs did not utilise them (thats not good. not all GARs are great but I would have thought a much lower percentage on the not taken up figure).

https://www.fca.org.uk/publication/data/data-bulletin-issue-10.pdf

Also 54% of those accessing their pension did a full withdrawal! Going with the majority isn't necessarily a good thing. As I told some dodgy saleman trying to convince me to take out an endowment in the 90's!

Drawdown should be almost as easy for an app, a few months ago someone posted a simple tool where you put figures in (pot, required withdrawal, age etc) and it gives the probably of your pot running out before a certain age (taking into account adverse sequence of returns etc), a more sophisticaed version of that combined with asset allocation/fund suggestions would be useful. Though I can see more benefit in an IFA for drawdown for some people.