The latter point is still a key issue for the industry as the Financial Ombudsman tends to back consumers that think they have been advised when in fact they may have just been gathering information in a non-advice website or D2C platform. So there is definitely one final piece in the jigsaw for the regulator to clarify. They must answer the crucial question: Where does Guidance stop and Advice start?
The FCA is set to rule on this last key issue within the next month with final rules being published by year end. Once it has done so, we think the coast is clear for developing and rolling out highly effective online tools and Guidance propositions which will put consumers in a much better position to make sound at-retirement decisions based on accurate forecasts and properly worked out scenarios.
We also think that, armed with all this additional knowledge, many will still choose to ask for independent (or restricted) financial advice. Many will also still see an annuity as the best product for securing a guaranteed income through their retirement. Ideally they will also select the annuity product that suits their personal circumstances best. And with the predicted increase in innovation in product design set to reach the market also, it should become easier for customers to get an annuity-type product which meets their retirement needs much more accurately than was possible before the Budget-linked changes.
Natanje Holt is managing director of Dunstan Thomas
