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FSA stakeholder guidance: advice implications

The PIA has announced guidance on the important issue of giving pensions advice in the period leading up to the introduction of stakeholder pensions.


Of course, suitability continues to be the basis for any decision but encouragingly the PIA do warn against delay.


However, it is clear that the imminence of stakeholder pensions is a factor that should be taken into account when advice on suitability is being given. Advisers (tied or independent) must therefore be fully aware of the proposed shape of the stakeholder plan and keep up to date with developments.


A particularly important issue is that of exit penalties under current plans should an individual contact you and then decide to switch to stakeholder clearly an option to switch to stakeholder with &#34no disadvantage&#34 will be a highly desirable feature of any plan currently on offer.


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