Anthony Carty: Pass or play with auto-enrolment and pension reforms

On Monday morning a pensions revolution will begin, with five million people up and down the country given the freedom to do what they like with their pensions.
[image type=”thumbnail” float=”left” src=”/wp-content/uploads/sites/2/2015/04/anthony.jpg” alt=”Anthony Carty, financial planning director at Clifton Asset Management” info=”none” info_place=”top” info_trigger=”hover”]
The sweeping reforms have also created opportunities and challenges in the auto-enrolment marketplace for Clifton Wealth.
The big question facing advisers was whether to pass or play when it came to offering an auto-enrolment service.
Passing didn’t mean ignoring auto-enrolment altogether but working with a third to party to ensure clients are given the service they deserve.
By playing, I was talking about being involved from the cradle to the grave. Clifton Wealth had no doubts, we were ready to play.
We already provided Sipps and SSASs to 1,300 corporate clients, all had a staging date and many were well on their way to be fully engaged with employee benefits.
However, some thought auto-enrolment was a new motoring club.
Clifton Wealth’s decision to play required extra resources but where was this to come from?
While that discussion was taking place, boom! The Chancellor George Osborne delivered his pensions bombshell that it would be possible to draw an entire pension pot and pay only the marginal rate of tax.
Totally unexpected but welcome all the same.
As a predominantly pensions-focused business, this presented Clifton Wealth with a perfect planning opportunity for those clients who wanted to take advantage of the new flexibilities. It also required extra resources.
Between the Budget freedoms and auto-enrolment, something had to give. We decided to segment the auto-enrolment opportunities and play with some but pass the rest.
Clifton has formed a strategic partnership with Lansdown Place Auto Enrolment Solutions to deal with clients who wish to comply but at the lowest possible cost. Any individual employee financial planning opportunities are passed back to us.
Clients who require a more holistic approach to their employee benefits, including auto-enrolment, are dealt with in-house.
The phone never stopped ringing and this is expected to continue and, more than likely, the volume of calls will increase.
We are ready and waiting to help our clients but at a price recognising that we have diverted resources. 2015 has already been an interesting year and the intrigue is set to continue.
Anthony Carty is group financial planning director at Clifton Asset Management

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