Industry pans watchdog's call for trail ban

Consumer Focus?

We are living in a world of increased regulation and increasing costs through failed organisations such as KeyData which puts pressure on businesses to plan further ahead. Who knows when the next FSCS levy will arrive as a result of the +=*'s failings. The consumer will ultimately have to pay for these costs. RDR will ban the payment of commission, but it is not banning remuneration through fees. Providing the client is aware of initial and ongoing fees prior to accepting advice, what is wrong with the idea of imposing ongoing charges for a continuing service. RDR and TCF are about openness and fairness, and if clients dont want service, they may as well go to a high street bank. Most IFAs will look after numerous legacy pensions with no form of ongoing remuneration. So whether its pre or post RDR, costs are rising and in order to cater for the increased cost burden clients will understand that we as a community cannot work for free anymore. Be open, be fair and honest, explain your service proposition and there'll be no reason why initial and ongoing fees wont become the norm.

Posted by: Smartone

IFA's need to wake up and smell the coffee.

There has long been a view that all IFA's need to move away from a transactional model to one that will provide long term value to clients and therefore the business. Whilst this report is wrong on many points, and contains a number of spelling mistakes, it does remind the industry and consumers that more needs to change. I think the industry still perceives itself to be in the 1980's when one sale per week paid the wages, only now that’s not the case. Since 2006 when the RDR was first promised far too many firms have done a lot less than they should have, and are now squealing. There is a market for Financial Advice and some consumers will pay, the job for all IFA's is to find them, add some value and charge accordingly. Until then there will be report after report about charges and commission et al. Simply because this is what the regulator and many consumers believe and it’s an easy sell for them. You will of course notice that the Pension churn by many of the High Street firms (a lot of which are effectively state owned) was missing in this report. Don’t be surprised at that, but don’t let that point hold you back from making the changes you require in your business now. My thinking is that come 2013 there will be a lot more business around for lots of reason you just have to position yourself and take advantage. Richard Smith – IFA Marketing Expert at http://www.theinternetconsultancy.com/blog/ifa/

Posted by: Richard Smith