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On the crest of a wave over stakeholder

There has never been any doubt in our minds that stakeholder pensions should be regarded as an opportunity and not a threat.

Our firm has been established for 15 years, concentrating mainly on pensions and investment advice. A significant proportion of our clients are small to medium-sized companies for which stakeholder is a very relevant issue.

This year is an exciting one for our company. Over the last few years, we have expanded and undertaken new ventures. We believe the time is right to redefine our brand and one of the steps we will take in early May is to change our name to BlueStone Financial Services.

We began working on our new branding and marketing plan last summer and stakeholder pensions were identified as a key target area.

This year got off to a good start when we were asked to make a presentation to the British Marine Industries Federation, which was looking for an IFA to advise its members on stakeholder pensions.

At the time of our presentation, there was still a lack of clarity in the marketplace as to exactly which companies were going to offer stakeholder and on what terms. However, we were delighted that the BMIF decided to use our services and accept our recommendation that a lead provider would be identified only when we were in a position to assess the full market.

Since then, we have been involved in a lot of activity, preparing specially branded literature for BMIF members and marketing our services at the London Boat Show in January.

Our chief executive, Jonathan Tyror, was also involved in finalising a joint-venture arrangement with a firm of accountants. This has opened up a whole new set of potential stakeholder clients.

As the year has progressed, we have kept our clients abreast of developments on stakeholder. We have posted information on our website and sent out information sheets inviting clients to contact us to discuss the issues.

Our consultants have kept in close contact with key clients to remind them that we are on hand to help. This has proved to be a good customer relations exercise which, hopefully, will translate into future business.

A survey undertaken recently revealed that around three-quarters of employers with between five and 50 staff are aware of stakeholder and almost half are willing to contribute to a plan. However, it is interesting that we have spoken to employers who still believe they have to designate a stakeholder pension scheme by April 6 and are not aware they have until October to do so.

But while employers are now more aware generally about stakeholder, there is undoubtedly a need for more promotion to employees. The Government&#39s campaign will no doubt do much to get the message across but it is hoped that providers, with their big advertising budgets, will also play their part.

The pace has quickened over the last month or so and, with a clearer picture of what is available, we have been busy meeting providers to find out exactly what they can offer. We have found that providers have been keen for us to meet and get information from their senior personnel such as their actuaries and marketing and systems experts.

When assessing the relative merits of the various providers, such as financial rating (we have found instances of some clients only wanting to use an AAA-rated company), we have also considered other aspects. Does the provider have efficient systems to enable the stakeholder facility to run smoothly? Can they help the client in setting up payroll systems to extract the necessary information?

Marketing is another key area. Companies vary in how much help they can offer. Our company does not have an in-house marketing department so assistance in that area is important to us.

The quality of a provider&#39s literature is another factor. Are its leaflets written clearly and is the design attractive? While this is by no means true of every company, it seems to us that many providers were slow in producing marketing literature. We would have found it helpful to have access to leaflets at an earlier date.

It would also have been helpful if providers could have had IT systems set up in advance so we could have seen them for ourselves.

Another confusing issue is that every single major provider has got a different type of remuneration structure.

By the time this article appears, we will have made a decision as to which company will be our lead provider. We will also have written to clients and followed up these letters to fix firm appointments.

Accepting that controlling costs and time is crucial if business is to be viable, we consider that time spent on a full fact-finding initial employer meeting is important.

Stakeholder gives us an excellent opportunity to increase business. The obvious attraction is that we will have the chance to meet and advise the senior directors and partners of companies. These individuals may well want us to be involved in their more sophisticated pension planning.

Employees and companies may wish to augment pension payments. Plus, with an enlarged client list, we have the opportunity to market a whole variety of other financial services – Isas, term insurance and critical illness, not to mention personal lines.

With just a week to go, we will be ready. We do not expect the world to change overnight but we do believe that stakeholder – and, importantly, the business, which comes because of it – will make a positive impact on our business.


iShares – iBloomberg European Technology

Thursday, 29th March 2001.Type: Exchange traded fund.Aim: Growth linked to the Bloomberg European investable technology index.Minimum investment: Subject to negotiation with stockbroker.Maximum investment: None.Investment split: 100 per cent linked to the Bloomberg European investable technology index.Place of registration: Dublin.Isa link: Yes.Pep transfers: Yes.Charges: Annual 0.5 per cent.Commission: None.Tel: 0845 3577000. 

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