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Backstage with Keith Richards

29th September 2015

What's going on across the pond?

 

Some people see the jet-set lifestyle as glamorous, but as I sit here on a flight back from the US writing this week's blog, I can tell you it's not as attractive a lifestyle as you might imagine! As CEO I do occasionally have the pleasure of travelling to different countries to attend key industry events, this time to a 3 day conference in Boston, but I can assure you it's strictly business and run over the weekend to reduce the business impact for advisers. 

Attending this year's Financial Planning Association conference provided me with an opportunity to collect global views of financial advice success, opportunities and threats and compare similarities with our own market. The ability to exchange ideas with our counterparts across the pond is invaluable and helps give me an understanding of areas where we, as a professional body, have room for improvement and where we are ahead of the curve.

It was particularly interesting to note that the UK is now seen as the 'gold standard' for advice whereas it was previously just seen as the gold standard for regulation. Globally, advisers can't comprehend an RDR-style regime in their respective countries believing it would lead to Armageddon!

As we continue the debate regarding adviser liability and the lack of a long stop, America is entering a new era of introducing adviser fiduciary responsibility to protect consumers at retirement from poor advice. Pension freedoms have of course been a feature of the US system for some years and the unintended consequences are all too evident. Unfortunately advisers and the cost of advice are under the spotlight for the wrong reasons, especially where consumers have exhausted funds and want someone to blame. The White House believe that adviser 'conflicts of interest' cost American savers over $17 Billion a year and tougher regulation is being introduced to tackle it.

I found it really insightful to see how the financial planning community in the US has dealt with pension freedoms and what issues have arisen during the process. I have been really pleased (although not surprised) at how well the UK financial planning community has handled the transition through what can only be described as a highly unpredictable and uncertain few years. We have faced challenges from government and regulators but the level of professionalism maintained throughout has been admirable...and I'm proud to tell our American cousins accordingly. It will certainly be an interesting time ahead as the unintended consequences of pension freedoms start to unfold here as well.

Technology and the new trend of robo-advice was also a hot topic of discussion and it is clear that we have a lot in common with our American counterparts.

The USA has over 300,000 financial advisers by comparison to c.32,500 in the UK and there are some valuable lessons to be learnt from both sides of the Atlantic, but I do believe the UK advice profession rightly deserves recognition for being the 'gold standard'.

Best wishes,

Keith
 

About the Blog

In this blog Personal Finance Society CEO Keith Richards will be keeping you up-to-date with all the Personal Finance Society news, projects and initiatives that we have in the works.

Read past editions of the blog »