With defined benefit (DB) pensions hitting the headlines in recent months, Nucleus brought together a panel of leading experts and financial advisers to help the adviser community navigate their way through the market and approach DB transfers.
Chaired by Nucleus’ Natalie Holt, the panel discussed what advisers are currently seeing in the market, the FCA’s response to the increase in demand for these services, how advisers should engage in DB transfer specialists and if partial transfers should be made more widely available, amongst other topics.
We caught up with one of the panellists, Nucleus’ product technical manager Rachel Vahey, to discuss more about the event, and what she would change about the current pensions system…
Nucleus recently held a roundtable to discuss the ongoing DB transfer saga. Can you tell us a bit more about this?
We wanted to put together a roundtable to explore the area of defined benefit transfers in more detail, and discuss how advisers should approach defined benefits transfers advice. We were keen to get a breadth of different experience and opinions – technical, trade association, platform, as well as adviser and a transfer specialist.
Why did you decide to hold this event now?
The subject of transfers from defined benefit pension schemes is one which is firmly in the public’s eye, with the FCA issuing various communications including its consultations on giving advice on transfers. We thought now was the right time to have a deep discussion and unearth the various issues advisers need to be aware of.
How do you think advisers should approach a client looking to transfer out of a DB scheme?
They have to be ready to help their clients make the best decision, and not shy away from having the discussion. For some clients transferring makes sense, and this, like so much, is about making a decision based on personal circumstances. Whatever the outcome, advisers have to make sure they document all discussions and decisions.
What one change would you make to the current pensions system to make it better?
To make it simpler, and recognise we need to encourage as many people as we possibly can to save as much as they can for later life. I would love to get rid of the unnecessarily complicated lifetime allowance altogether and to have just one simple annual allowance.
If you could give one piece of financial advice to a teenage version of yourself, what would it be?
To set a strategy – think about where you could be in later life, and what you need to do to get there, whilst recognising and accepting change will happen. But also to enjoy yourself. I’m discovering life is passing by at a very fast rate!
What one thing would you change about the financial services industry as a whole?
For people to have more trust in pensions and in financial services in general. If they did more people would want to get advice and/or guidance, leading to more people to make better financial decisions.
What is your biggest pet peeve?
Bad communication. I hate companies and people who hide behind obscure language and terminology, and fail to get out a simple message.
Tell us a little about your life outside of work, do you have any hobbies?
I love going to the cinema and theatre, although I don’t get there as often as I would like. I’m involved with our local school PTA, and I am trying to run more in 2018 ….
What is the one column or website that you read every day?
I have recently become a convert to podcasts to get my information, as they seem to fit my life better. I keep up with a few financial services ones, as well as ‘How I built this’ and ‘The News Quiz’. And I follow Dan Snow for my History Hit.
What would you do if you received a windfall of £10,000?
I would do what I think most people would do – spend some on a fabulous holiday with my family, and invest the rest for our future.