Kim North Interview

Kim North

Technology & Technical, Managing Director

Kim has over thirty years’ experience in the retail financial services market and has worked with over one hundred financial services companies. She advises on corporate strategic direction for providers and adviser firms as well as industry associations. She has an in-depth knowledge of regulations governing product manufacture and distribution, especially through financial advisers.

As a Money Marketing columnist, Kim provides regular commentary on developments in the market and the opportunities for financial advisers; subjects cover everything from pension freedoms and pension transfers through to investment options and compliance issues.    

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More people have been looking to transfer out of their DB scheme post-freedoms - why do you feel many advisers are still reluctant to take on these cases?

With the current need for anyone with over £30,000 in their DB scheme to receive regulated advice from a financial adviser, the opportunities for advisers are phenomenal, particularly when you consider that private sector scheme assets are at about £1.5 trillion and the Local Government scheme £233 billion. However many IFAs I speak to are not offering DB transfer services due to the compliance risk and expensive PI.

What are the factors which make this a particularly challenging area to give effective and compliant advice on?

It’s the required qualifications which take hundreds of hours of study, the FCA rules are out of date as critical yield calculations are needed assuming an annuity will be bought which is not the case due to there being less and less annuity providers and annuity rates at a 40 year low. Drawdown is the preferred course of action by the majority who transfer out of DB schemes.

What clarifications do you feel the regulator should be making to ensure that people are able to find an adviser to look at their case?

With the current need for anyone with over £30,000 in their DB scheme to receive regulated advice from a financial adviser. I’ve long been of the opinion that there needs to be a comprehensive rewrite of the FCA Defined Benefit pension transfer rules to reflect the current market.The regulations need to be at the right level to incentivise financial advisers to work with transfer clients and steer those who should take a full transfer, a partial transfer and no transfer, to the right decision. After all if Financial Advisers won’t give transfer advice, who will?

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