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Professional Bodies in Financial Planning | The 2019 Perspective from the PFS

  • By Jason Stockwell

In last month’s edition of IFA Magazine, we talked to the CISI about what they are doing to help build the financial planning pr ofession in the UK. This month, w e talk to Keith Richards, CEO of the Personal Finance Society about some of the initiatives that are underway in order to grow the profession and build greater consumer trust


Now that we are heading towards spring and the nights are finally getting shorter, it is worth taking a brief reflection on the challenges which 2018 presented for the financial planning profession in order to help us focus on the key opportunities for the year ahead. Historical evidence often provides the experience to evolve and be better positioned to respond to the uncertainties of the coming calendar year with more conviction and certainty.

Building Trust

It is now more than a decade since the global financial crisis of 2008. Unfortunately, public trust in our profession – whilst higher than it was in the immediate aftermath of the crisis – is still lower than it should be. Addressing this deficit of trust will be a continued focus for the Personal Finance Society.

The profession’s pro-bono programmes are making a real difference in changing people’s perceptions, but more importantly, they are changing their lives.

Getting Out There

The ‘Discover Fortunes’ programme demonstrates the very best of what our sector stands for: we are proud of the fact that experienced professionals are visiting schools in all four corners of the British Isles to help raise financial awareness and education for the next generation, initially starting with interactive games to boost engagement. ‘MoneyPlan’ in partnership with Citizens Advice and ‘Forces MoneyPlan’ for veterans of the armed forces are also volunteer programmes which are making a profound difference to people’s lives.

Indeed, the need and demand for professional financial advice is only expected to increase as the UK grapples with an increasingly ageing demographic, pension freedoms and the largest intergenerational wealth gap since records began

The profession’s pro-bono programmes are making a real difference in changing people’s perceptions, but more importantly, they are changing their lives

 

The Intergenerational Wealth Gap

The Personal Finance Society’s own 2018 annual Symposium highlighted the need to tackle this intergenerational wealth gap. It is expected that some £400billion will be transferred between generations over the next decade and advisers need to be prepared. Present and future financial planners will play a pivotal role in meeting the financial planning needs of millions of consumers and helping to address some of the key societal challenges of our time.

In addressing the wealth gap and aiding financial understanding amongst the next generation, the role of education cannot be overstated. The Personal Finance Society will continue to advocate for financial literacy to be accessible for all consumers and at all stages in life. I am personally optimistic that the new Single Financial Guidance Body will play a significant role.

More Relevant CPD

Continuing professional development activities and the sharing of ‘good practice’ will be stepped up a gear this year, based on experience and future needs from both a technical and soft skills perspective. Themes such as life planning, long-term care and developing skills to help recognise and deal with vulnerability are all high on the agenda.

The need and demand for professional financial advice is only expected to increase as the UK grapples with an increasingly ageing demographic, pension freedoms and the largest intergenerational wealth gap since records began

 

Overcoming Obstacles

Of course, concerns over inappropriate DB pension transfers rather dominated the headlines of the consumer money pages in 2018. Whilst pension freedom has provided opportunity and demand, it has also impacted the sectors reputation, mainly stemming from high profile fiascos such as we witnessed in the case of British Steel employees. We must not allow the minority to distort the reputation and progress of the majority of professional advisers who do such great work in helping their clients to achieve their goals. However, we can only address this by being a united profession and working together to weed out the ‘bad-apples’.

In specific response to the growing concerns surrounding DB transfers a new cross-sector Pensions Advice Taskforce was set up. A new consumer guide has been developed which is identifiably linked to an adviser code and badge The need and demand for professional financial advice is only expected to increase as the UK grapples with an increasingly ageing demographic, pension freedoms and the largest intergenerational wealth gap since records began to better empower consumers and provide the confidence of what to expect when seeking professional advice. Pension Wise, MAS and TPAS and all constituents of the pension sector, including PI Insurers have been involved in the creation of a ‘gold standard’ for DB pension transfers. Implementation of this is planned for March.

In 2018, London unfortunately lost its place as the world’s top global financial centre to New York. This was certainly a psychological blow to the City amidst the chaos of Brexit. But if the measure of a place is the calibre of its people, the City will not be beaten into second place indefinitely.

Our profession has continued to improve its diversity and inclusion. This is integral to the goals of the sector as we move forward on the journey of evolution. We have world class talent and expertise in our financial planning community and harnessing its full potential will be critical in meeting the challenges of 2019.


Keith Richards is CEO of The Personal Finance Society

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