Anticipating this argument, the Treasury has made £20m available to help providers give financial guidance to pensioners as they make their decisions. Our view is that this money will barely touch the sides as the risk of miss-selling at-retirement falls firmly at the provider’s door at a time when the complexity of decision-making has just increased massively. Simultaneously, providers will have to consider the cost of administrating different income options and will need to work harder to understand their clients in order to ensure they are giving suitable guidance.
What is clear if we are putting more responsibility on the individual to manage his or her financial affairs sensibly and carefully right through into their dotage; then it is going to be critical to educate them better on financial matters - long before they reach retirement.
Natanje Holt is managing director of Dunstan Thomas
