Individuals will start to want to take more responsibility for their finances. I hope from the freedoms we will see significantly more individuals come into pensions and understand what they need to do.
This is fantastic for the intermediary and the financial advice community. As more people understand they need to take more responsibility for their actions, the value of financial advice becomes more and more important.
It’s incredible for society and the financial services industry – both platforms and advice. This is a game changer.
There have been some quite significant changes over the previous years – auto enrolment and Nest being an element of that. But this is really significant and really beneficial.
The caveat is it will take time for people to understand how important this is. People shouldn’t be waiting to reach retirement; they should be thinking way in advance of that.
The vast majority of the public aren’t savvy and find finance a difficult concept to deal with. Human behaviour doesn’t allow itself to think that far ahead – it’s too hard to contextualise what you’re going to be doing in 10 or even 40 years’ time.
Whether an active manager chooses to or not, they will invariably be involved in boardroom issues and discussions. But while the passive industry has no real interest in what they are doing because they simply follow an index, I wonder whether they forfeit the right to be involved with the boardroom conversation.
Managing a business with over 40 Oeics, 200 Sicavs and 20 investment trusts is complicated. Juggling all of that in terms of products and client types makes managing my own time the greatest obstacle.
The single biggest change in my 21 years in the industry is the importance of the consumer and the end client. When I first started, the consumer wasn’t always what we thought about, it used to be thinking about ourselves as product providers.
Without the end consumer, we don’t have a business. Whether that end consumer is through an Isa, investment or pension, we manage their money. It’s a welcome turnaround.
Society generally has become much more short-term focused about everything. There is the need to switch something on and have it work immediately.
The danger is that people start to think of their investments in those terms. Investment should be long-term and most processes are built around long-term thinking.
One of the things that can frustrate consumers about financial services is the bureaucracy. I would like to see a digital passport, which you could use to set up any account – an investment, loan, pension for example – that would make things significantly easier for the industry.
If the set up of investments could be much easier, the industry would be sympathetic too. I would like to see it in this year’s manifesto for all parties.
You don’t want consumers being attracted to investing then having to spend so much time getting on board that they lose interest. That’s exactly where we lose people, even if they are four fifths of the way through.
