Paul Lewis’ recent column in Money Marketing provoked a lorry load of comments and reinstated the debate on financial journalists remaining exempt from competence requirements. I am sure many journalists could confirm their competence with minimal preparation but, for some, it could be a barrier that would impede rather than empower them.
I recall being asked to prepare a case study by a major Sunday broadsheet and, when I failed to mention any of its regular advertisers, I was asked to rewrite the piece so they were included. Being active investment houses this was problematic because, as a firm, we have used passive funds for many years.
In the end I dropped out of the article and found one of my peers had happily capitulated instead, compromising themselves and overlooking the very conflict of interest ignored by the publishers of so many newspapers. The double standards in play have always concerned me as some personal finance editors have directly benefited from these deals.
If we consider commercial radio, for example, where it is not possible for advertisements to be placed in such advantageous situations, why are newspapers not bound by a similar rule?
I should make it clear I have no agenda here – I just prefer people to access information or guidance without any bias. This is particularly so with regards to the new options for pensions.
It is clear to me that much of the public will be less than convinced of the need for or the price of advice, so until they receive all of the information they need to digest we need to tread carefully.
Many providers will be less than keen to operate what is no longer seen as a pension plan but as a bank account instead. Those who seek to withdraw the fund over a short period may find their provider requires them to move to a more recent plan.
But before the public rush to complain about the cost of moving to a new plan they need to be reminded of what happens elsewhere. For example, if someone wanted the new features of an iPhone 6, their phone provider would ask them to either pay more or to move to a different contract. With this in mind, being charged to move to a new flexible pension account is no different.
Putting things into context is essential if we are to successfully communicate with the general public. What is more, clear communication is the only way to obtain informed consent.
We all have a part to play and agreeing to use a standardised set of graphics would help. For instance, when people chat to friends the information delivered by those graphics would help prevent the confusion that so often arises when two people have two totally different ideas about the same issue. If widely adopted, then it could even go viral.
Guidance cannot exist in scripts alone. We have to be more creative in order to help people make more informed choices.
Robert Reid is managing director at Syndaxi Chartered Financial Planners