Contingent charging, technology and a new website!
April was a busy month for us here at Lemonade. Beginning with attending our first DB-DC Transfers Under the Spotlight conference, an event which proved very insightful.
A main topic of discussion at the event was contingent charging, a very relevant and opinionated area. We found the majority of conversations were clear that contingent charging has no place in modern workplace advice, for the reason that those who do transfer are essentially paying for those who don’t. There was also a common consensus that a simple fixed fee funded by the employer is a ‘no brainer’ and simplifies the costing process.
DB-DC transfers is clearly a complicated area for members. It was discussed that it will typically take 6 or more hours of meetings to gather and assess the information required to make a recommendation to transfer, but it might take significantly less to recommend staying put. It gets complicated for the member as they need to have a wide understanding of not only DB and DC schemes but longevity, cash flow modelling and pension freedoms. The list goes on and on and is frankly an intimidating prospect for many, which may explain why at the event it was reported by the FCA that DB transfer advice is 700% more likely to be unsuitable than investment advice!
We question how much of the advice process can be simplified through digitalisation, making members aware of the DB-DC landscape through use of a portal where all relevant information, useful tools and videos can be used to simplify the process for members and result in a more efficient and appropriate result.
It wasn’t just the one event in April, we also attended Pensions Aspects Live. Where the link between technology and pensions was a prominent theme, this linked perfectly with our Retirement Options Solution, many delegates were impressed by how we combined our advisers with technology to simplify pension freedoms.
And did we mention we have a new website? Take a look around!
Note: The Financial Conduct Authority does not regulate cash flow modelling