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Pensions worth more than 1%

Reading Peter Jordan&#39s Sandler Forum article (Monday Marketing,

February 13) makes me realise just how far head office people are

away from the real world of dealing with the public on pension

matters.

Peter Jordan naively comments that all IFAs need to do is make sure

the products they recommend and the advice they provide really do add

value relative to stakeholder products. The whole point is that

clients have no idea as to the value of the advice until their

pension policy matures and this may be in 30 to 40 years&#39 time

Mr Jordan still makes the mistake of assuming that the commission

relates to the cost of advice at the time but the reality is that the

help and advice we give to our clients is throughout their working

life, culminating in helping to smooth through the payment of an

annuity.

As we all know, this is the time of most stress for our clients,

where they need the most help and where, sadly, many of the annuity

companies&#39 administration sections are woefully inadequate.

The hard fact is that a pension plan never was and never will be a

simple product where a 1 per cent charge is remotely sensible and we

need everyone to hammer this home.

In the meantime, it is the public who are losing, as IFAs like myself

cannot afford to spend as much time as previously with existing

clients and turn a lot of business away. While charitable work is

admirable, it does not pay our mortgages and other living expenses.

I really would like to see Mr Jordan, Mr Sandler and all others who

even dream of a 1 per cent world working as IFAs for as long as it

takes to experience life in the real work of dealing with pensions

and also realising that, to advise a client properly on pensions, one

has to talk about all the other pension plans which the client has

amassed over the years. Very little is simple, believe me.

Incidentally, in your same paper, Standard Life (which I understand

receives more pension business than any other company) says providers

will turn away from the new Sandler suite of products if they include

a 1 per cent charge cap and points out, quite rightly, that

stakeholder has failed to reach the poorer people who it was supposed

to encourage.

The simple truth is that the pension companies obtain most of their

business from IFAs. If it is worth our while, we will help market,

advise on and continue with the substantial ongoing servicing of this

business. If not, we do not really want to know and, without our

commitment, a substantial volume of pension provision will simply not

happen.

How Andrew Smith can describe stakeholder as a success can be nothing

but further spin. We really need to see more people telling it how it

is.

JJ Russell Green Malvern, Worcestershire

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