Consumer Duty

See Below Copyright Cover Magazine 17 May 2023, What is consumer duty does it protect the consumer or the adviser, or both?

Engagement the largest consumer vulnerability area: MorganAsh

MorganAsh’s Resilience System (MARS) has identified the ability of consumers to engage as the largest area of vulnerability ahead of Consumer Duty implementation in less than three months.

Engagement incorporates factors such as language, digital interaction and coercion, and MorganAsh detailed that these traits represented in around 12% of customers, as the highest reported issue among MARS users was the willingness to engage.

MARS identifies over 400 variations in characteristics and circumstances that can lead to consumer vulnerability, and physical health issues are “far more prevalent” than mental health issues, MorganAsh noted.

MorganAsh stated that without a consistent and objective approach, firms will not be able to properly assess or evidence the vulnerability of all customers in time for the Consumer Duty deadline.

Andrew Gething, managing director of MorganAsh, commented that as users of MARS identify engagement as a key challenge, amending the client’s communications strategy to overcome engagement issues is a “relatively understood issue.”

He added that the aim is to allow those with “good” financial knowledge to self-serve, while trying to “nudge those who don’t into an advised process.”

“At present, firms are reluctant to stop those with poor financial knowledge from transacting on a self-serve non-advised basis – partly to understand the process more, and partly in fear of losing business to competitors. How this plays out once Consumer Duty comes into force will be interesting.”

Advice

I am looking to add a donations page to the site, why would someone donate?

That is a good question, financial advice provided by the banks is free at the point of entry right, you can walk into your bank or building society and say can you tell me about, borrowing to buy a house, buy your half out of an inheritance, plus many other pieces of advice.

You can take out some insurance. All you have to do is make an appointment an employee of the bank will follow their process maybe ask a few pertinent questions and advise you, easy. But what happens if you want advice from us, qualified advisers who have got the knowledge can access not just one banks products but several and also do a thorough investigation of what you need.

It’s going to take time and therefore a bit of money, hence my idea to ask for a donation, I know you don’t know me, and if your anything like me your reluctant to pay for “advice” online. However we have partnered up with a reputable charging provider in Stripe and we are happy to give it a go if you are ! Now where is that donate button…

Do not panic

Market turmoil is just that, there will be buyers and sellers, winners and losers, and the funny thing is it’s just an emotion. There are shifts that will affect a market, interest rates is one thing that could affect the housing market, from people who are trying to enter the market, (How much can I borrow, and how much is it going to cost?) Interest rates go up it is going to cost the borrower more, and potentially you won’t be able to borrow as much. Makes sense, does it? Then there will be people who are already in the market, and trying to keep a handle on their budgets, not easy for any of you at the moment. Especially if you are being requested to pay more for something that cost less just a few months ago.

People leaving the market, may have to review their expectations as to how much the market will pay for their property, none of this is rocket science, it is mostly common sense. What can I say, seek help where it is needed, never be afraid to talk, because talk is cheap, and there will be people willing to listen and some may even be able to help. As you go a long your journey. All will have a different experience just remember there are only so many hours in one day, and only so much that can be achieved, don’t stress, accept things that are out of your control and try to be nice to people because one day you will be on a different path.

Inherited property and consumer buy to let.

What does it mean for inheriting offspring to take on the family home. It is never going to made to look like a simple process because the legal profession want a part of the pie, but does it really have to be that difficult. There are so many ways to retain ownership of property as opposed to selling out. Often there may be siblings who have to agree on what happens next, then there might be fear of taking on new finance to buy out other family members or may be agreements have to be made as to who retains “ownership” AND in what shares. These are all simple to overcome problems, but agreements have to be reached to keep all parties concerned happy. Which I guess is partly why people engage a solicitor or even a financial adviser to help oversee the transaction.

HERE endeth todays lesson.

The take-aways from the British Steel Pensions

From an outsiders point of view it seems that the original scheme offered by British Steel was a final salary scheme I would imagine with some guarantees, the problem being at the point of being taken over by Tata, there was talk of transferring the said final salary scheme to a money purchase with a buy out, Ouch, I don’t fully know the ins and outs of what the old scheme was, neither do I know what was said about taking the cash equivalent transfer value, however I imagine depending on your age there were options and choices and like all advisers or salesmen there is influence and when there is influence people are asked to make decisions. Now this is of course where looking back, at previous choices, there are good and bad, isn’t this the same for every purchase or transaction that we make. The difference being of course that people can and do take up litigation often encouraged by the mis-selling firms, where there is blame their is a claim. So If you took the cash and transfer and then five years later realised it wasn’t such a good choice, lets go sue the original adviser.

I could go on but I am sure you would all get bored, I guess the truth is financial advisers are generally working for a commission, and the advice being given isn’t always the best advice and in some cases can lead you to become worse off. Who said retirement is a good deal anyway? Next time I might blog about pension credit or small retirement pots. Keep cheery until then.

Unindustrialisation

I just made that title up. No such word, however having just listened to a meeting about the British Steel pension scheme fiasco, it just makes me think. South Wales has had it’s steel industry effectively moth balled, it’s paid off all the old staff with a very dodgy sounding pension shenanigans. There is mis-trust between the retired workers and the financial watchdogs. “We was robbed” I think are the words being branded around, and there may well be anger in the tone of voice.

And if you look back at Mrs Thatcher closing the majority of coal mines, this isn’t the first time something like this has happened. Is this a temporary closure or is this a more sinister enforcement of NET ZERO. I don’t know, and to a certain 10 degrees I don’t care, my eco solar panels have produced 515kilowatts of electric since well about 5 weeks ago, not enough to cool down the south of England that is for sure.

And nor is it enough to power an electric car for everyday use, so we are doomed, we are going to melt and more than likely starve due to climate change, never mind and keep your chin up as one of my favourite bosses used to say. Have a great rest of the day.

Making Appointments

Every business needs to speak with their customers one way or another, and we really do have so many ways to reach out. However which one is most successful and the only answer I can think of is the telephone. All these lets arrange a meeting online via teams or using calendly don’t work right. And do you know why because of the link that you need, for example if my calendly link is calendly.com/nickbailey then great you might be able to make an appointment. Is it not easier just to pick up the phone and say Hi Nick have you got 5 minutes to have a chat, or can we make a time to talk? Rather than I know I will login to calendly is the link is correct and schedule a meeting !! Which then copies itself into my calendar. CONFUSED I am also…..

Confusion Reigns in the UK

Well Boris is going to step down from Being Prime Minister in the Autumn, I don’t really do politics, however I give the man credit yes he may be a Buffoon, but he sticks with his beliefs and doesn’t say I can’t handle this, neither does he leave in tears. This isn’t my thought of the day. Todays thoughts are about Power, you know the stuff that comes through the wires and well heat from somewhere. It’s mid summer here no cold damp autumn weather, so reasons to be happy about having solar panels, keeping my electrical items running for “free” whilst the sun is out. And If I had a battery, keeping the lights on for the evening. Never mind I have a grid system so excess power worms it’s way back into the grid, for someone else to use.

This gets me thing how much power is silently sitting on the roof, could pumping air in a controlled way even work in the autumn, as in heat? Or have I just forgotten about how winter really is just cold and dark. Who knows or more to the point how smart is my little electric fan in the loft? (there is more to this of course)