#PensionWashing - my gift to 22m and the #SocialMedia #Finfluencers

I write this article as an introduction to the 3rd and probably last chapter in a Trilogy of exposing poor practice in the murky and sinister world of UK Pensions over the past 30 years.

The battle lines have been drawn, I have alerted the Regulator(s), Government and the 'Great and the Good' in the UK Pensions world, who for the record have played an absolute fucking blinder trying to shut me up and not exposing the Pensionwashing that has been going on for the past two decades.

But as we wind down towards Restitution Day or #RDay this Halloween ?? I wanted to hand over to the #Social Media #Finfluencers some very important research that goes back to the mid 90's which the most powerful brands in Pensions and Savings have purposefully ignored, to the detriment of both millions of customers and Society.

This article is written in response to the Linked In News featured article on #Finfluencers may be on the money.

Well I guess we'll see whether they are, or not. Enjoy.

The Role of #Finfluencers exposing #Pensionwashing

#Finfluencers have an important role to play, there is no question of that in my mind. All of the pro's and cons are present in this sector of the 'advice' market as they are within the wider UK #Pension and #Savings industry.

In 2020 we have learned through Social Media about #Greenwashing and in 2021 it's time to introduce to the Social Media World #Pensionwashing.

Both are used to paint a far more rosy picture of the professional solutions being provided to financial customers than is actually the case.

Is Pensionwashing the Greatest Jedi Mind Trick ever?

Like many of Gen X, I grew up watching the Rebel Forces battle it out against the might of the Empire for the good of the Universe.

I can't help myself using the Star Wars analogy for describing #Fintech #Disruption ("the Rebels") battling it out with 20th Century Insurance Models ("the Empire") to improve better outcomes for Societies across the world ("the Universe").

There is an iconic scene where we first see Obe-Wan use a Jedi Mind Trick on Empire soldiers "these are not the droids you're looking for" (link below)

Jedi Mind Trick

These are not the Failures you're looking for, move along

In the Pension version, the Jedi Mind Trick over the past 20 years has been to cover up the failures of 20th Century Pension Schemes being used to onboard 22m UK Workers into guaranteed shortfalls at retirement, and yet an industry is still being allowed to make billions in profit from products that fail to meet the needs of millions of customers.

"these are not the pension failures you're looking for, move along".

Pensionwashing has been around for over 20 years

#Pensionwashing has been around for the best part of two decades. It first emerged following the Welfare Reform and Pensions Act, which ushered in #Stakeholder #Pensions under a new Labour Government.*

Then it stepped up a whole new level via the new Coalition Government under #AutoEnrolment.

The Failure of Stakeholder Pensions

The 'naughties' were a decade of commission driven activity fueled by the Empire, which saw a flurry of old charging structures and schemes resold 2x or even 3x in 12 years by the elite of the UK Financial Advisory world - which saw charges reduce from an average of around 1.4% down to around 0.75%.

After a decade of #Stakeholder churning, the Empire, in conjunction with its then #Finfluencers (lobbyists in the corridors of power) explained to Government that despite all the 'vast improvements in charges' and Stakeholder product features, it hadn't done enough to grow the market participation - in fact long term savings went into reverse and declined.

And with the UK's elite Financial Advisors using a 'green card' from the Regulator to churn, the Empire called a halt to the commission monster that they had fueled and their Shareholders would no longer agree to finance.

Part of ￡6bn was spent to achieve an improved retirement income worth the equivalent of a Cornetto every month

*I first exposed the murky charging world of UK Pension Schemes in 1998 via Paul Smith's IFA Analysis report, which L&G kindly bought 5,000 copies of and shared with its top #Finfluencers of the 90's, who in turn rubbed their hands with glee to churn pension schemes for the financial benefit of the price of a Cornetto (circa ￡1.80/mth).

The New Dawn of Auto Enrolment Pension Savings & Fintech Rebels

The Empire's power brokers negotiated a new dawn of Commission Free Pension products, which were introduced alongside Auto Enrolment in 2012, so next year is a very big year, because it marks the 10th Anniversary of the 'new dawn' in the UK Pensions Universe.

However, there is also the 10 year Anniversary of the Rebel Forces and #Fintech Decacorn platforms who emerged to drive down costs even further, giving millions access to low cost 'Robo Advice' models, which we were told would revolutionise the industry for the good of the 'underserved' consumer.

An explosion of new Rebel Fintech Platforms arrived to battle the Empire on Cost

Early Rebel platforms like NEST, NOW, Nutmeg, Betterment, Wealthfront and even more recently Pension Bee, arrived with a slurry of new low cost offerings.

Whilst Evidenced Based Investing (EBI) using Empirical Evidence explodes onto the IFA market where Modern Portfolio Theory (MPT) and phrases like 'Value at Risk' and 'Target Dated Funds' emerge from the elite of the new Fintech Advisory World and DC Investment Consultants hired by the new wave of Master Trusts.

In 2021 the DWP has just revealed that the average Large Scheme member rate is now 0.4% whilst the average rate amongst smaller AE schemes stands at 0.5%.

So over 20 years we have seen a massive reduction in fees from 1.4% to 0.4% on average and a few million members in GPP schemes rise to 22m in DC Workplace schemes that has benefitted from all these amazing enhancements.

Will the 10th Anniversary of Auto Enrolment & Rebel Fintech Platforms reveal True Success or yet more Pensionwashing?

Well it depends what side of the Pension Universe you're from.

If you call 22m UK workers paying professional fees and charges for a product that will only ever meet 50% of the real consumer need a success, then the Empire's #Finfluencers have worked fucking miracles.

But that's not the really amazing mind blowing 'success' that the Empire's #Finfluencers have achieved, nor is making a shit load of money selling a crappy product that will never actually work using 20th Century systems or outdated thinking.

The really out-fucking-standing Jedi Mind Trick that I have seen start to emerge from the Empire's new wave of willing #Finfluencers is this:

THE EMPIRE'S SOLUTION TO A MASSIVE FAILURE THEY KNOW I AM ABOUT TO EXPOSE AS THEIR FAILURE, IS TO PASS THE BUCK TO EMPLOYERS AND EMPLOYEES.

THE PROBLEM, THE EMPIRE SAYS, IS THAT EMPLOYERS AND EMPLOYEES ARE NOT SAVING ENOUGH AND TO SOLVE THE PROBLEM EMPLOYERS AND EMPLOYEES WILL HAVE TO PAY THEM 50% TO 100% MORE EVERY MONTH TO SOLVE THE PROBLEM THEIR GREED AND INACTION CAUSED.

I mean come on, that's a real mind blowing Jedi Mind Trick right?

Blame the customer, not the shitty product that has no connection whatsoever with their customer's need and wants.

Finfluencers Do The Maths and Don't Be Duped

It's not Employers or Employees who have failed 1 in 3 UK workers, it's the Empire, the UK's elite Advisory Firms and the new wave of #Fintech platforms that have focused exclusively on costs and wasted the past decade.

And now the UK's Fat Cat CEO's are all rubbing their hands at the prospect of their most audacious Jedi Mind Trick ever paying off, as they try and dupe millions into parting with another 50% to 100% increase in contributions every Pay Day.

A Gift worth on average around ￡78,000

So in 2021 my gift to 22m across the UK is the term #Pensionwashing.

I'm handing over Pensionwashing to the #Finfluencers, Social Media Financial Channels and Life Hackers to warn 22m pension members, along with their 1.8m SME's, to be 'eyes wide open' and to 'wake up and smell the coffee'.

The mother of all financial Jedi Mind Tricks will result in 1 in 3 paying 100% more in contribution costs than the most effective and efficient 21st Century Pension Funding solutions, which also support the United Nations SDG's.

Or if you think boosting a flawed business model by investing every Pay Day up to 100% more contributions into a product that hasn't worked for TWENTY YEARS is good finance, then do nothing and write about 5 Star Products that have failed most of Gen X and will fail most of Gen Y.

R Day is coming ??

Alternatively, if you think it's an outrageous fucking liberty, which for the record the vast majority of my customers think it is, then you'll understand why the FCA Executive received a Restitution Claim in February 2021 against named and un-named parties worth ￡17m.

My customers are having to submit yet another claim this month to launch R Day for a further ￡1.1m, which this time highlights the negligence of individuals in the Justice System who think they are above the Law too.

By ignoring COBS and expert financial evidence, several Judges have acted against my customer's Best Financial Interests, choosing instead to protect the privileged few, at the expense of the many.

When I say I am going to do something, I do it. The Empire has had its day, the Rebels and R Day are coming.

The Fintech enabled platform I promised that would educate, inspire and empower millions of savers, as well as improving society outcomes, will expose all the skeletons and negligent parties this Halloween ??.

If you think you are above the Law, and purposefully act against not only my own Customer's Best Financial Interests, but also 22m Pension Members, you will be held accountable for your actions, or, inactions.

#TimeToEngage #DoTheRightThing #ESG #ImpactInvesting