Ryan Mellor Co-Founder at  IFA Direct Home answers your most frequently answered questions.

Pension Holder: Why have you contacted me?

Ryan Mellor:  Our call is in connection with the investigation carried out by the former Office Of Fair Trading and the current Financial Conduct Authority, into wide scale overcharging by the UK’s pensions industry. The purpose of the call is to arrange an appointment with an IFA or restricted advisor.

Pension Holder: What happens at the appointment?

Ryan Mellor:  What will happen at the appointment is that the IFA will complete a fact find before writing to your pension firm to get all the facts and figures from which he will prepare a report. From this he will make a recommendation – but only if he/she can better what you currently have. The review will have the intention of checking what your existing pension charges are.

Pension Holder: What’s in it for IFA Direct Home?

Ryan Mellor: IFA Direct Home offers marketing services for a fixed fee on behalf of companies within the financial services industry.  See http://www.rmtdirect.com

Pension Holder: Whats in it for them (Financial Services Firm)

Ryan Mellor : Since the Retail Distribution Review (RDR), traditional commissions have been abolished. IFA Firms can only transfer pensions if they can save you money over and above what their fees are. The initial meeting is offered  at no obligation, to see if this is possible.

Pension Holder: Who is IFA Direct Home?

Ryan Mellor: IFA Direct is a registered marketing brand within the financial services industry.

Pension Holder: What’s  in it for me?

Ryan Mellor:  The potential to save money and to improve the performance of your pension. There is no initial charge and no obligation and the professional independent advice is in plain English. You will receive a detailed report which includes a list of all charges coming out of your funds each year.

Pension Holder: What can you do better than my current pension provider?

Ryan Mellor:  Before reviewing how your pensions have performed it would not be right for me to guess, as your pension might be performing well. After the review the financial adviser will fully explain your pensions past performance and only if it would benefit you, he/she will be able to give you the options available for the future.

Pension Holder: What are you selling?

Ryan Mellor: We are not selling anything. We are offering independent pension reviews without charge or obligation.

Pension Holder: I cannot take my pension until I am 55. Is there anything I can do?

Ryan Mellor: That’s a great question but I am the wrong person. By having the review these are exactly the type of questions that will be answered for you. But the short answer is no.

Pension Holder: Where did you get my number from?

Ryan Mellor: We purchase data from companies using only data that has been opted in. ie. The user has given permission from a website giving their consent for third parties to make contact.

We can upon your request provide a date and time stamp together with an IP address from where you opted in.

Pension Holder:  Where are you guys based?

Ryan Mellor: IFA-Direct.com is a registered trading mark of RMT Group (UK) Ltd, which is a UK registered company. We operate a call centre based in Mijas Costa, Spain.

Pension Holder: Who is IFA Direct Home?

Ryan Mellor: IFA Direct Home is a brand owned by RMT Group (UK) Ltd. RMT Group (UK) Ltd is a specialist marketing company that specialises in leads generated for the UK’s Financial Services Industry. IFA Direct Homeconnects people like yourself with good quality local regulated financial advice.

Pension Holder: Are you regulated?

Ryan Mellor: No, we are not giving financial advice. We are an appointment setting or marketing company working on behalf of both regulated Independent Financial Advisors offering whole of the market and restricted financial advice who are all regulated.

Pension Holder: Do you vet the company itself?

Ryan Mellor: No, but we check to ensure that they are regulated by the Financial Conduct Authority (FCA). This regulation in itself is really the vetting process, which protects you in the fact that the right advice has to be given to you. You are also protected by the Financial Services Commission Compensation Scheme.

Under FCA ruling if they cannot better your present situation, then the IFA or advisor is obliged to leave your pension / investment where it is. So it really is a WIN WIN situation. You have nothing to lose but your time.

Pension Holder: How much will this appointment cost me?

Ryan Mellor: It varies, but the IFA will:

1. Sit down with you and complete a questionnaire or fact find which will determine your attitude to risk.
2. Contact your pensions company on your behalf
3. Write a report on his findings.
4. If he can save you money which is OVER and ABOVE his fee then his recommendation to transfer will be made.
5. If you want to go ahead he will then transfer the pension and his fee will be deducted from the principle.
6. He will only do this if it satisfies compliance and you are happy.

So if the annual savings are £800 and his fees are £800 and you had 12 years to go till retirement – then it may well worth be doing.

Pension Holder: Will it ever cost me money?

Ryan Mellor: No, the net result will only ever save or make you money. Under FCA guidelines the advisor can only give you advice if he can improve your current situation.

Say for example, you have a pension worth £100,000 and the charges are 1.5%. This means that £1,500 is being lost each year in fees. Modern pension can purchased for less than 0.5% annual charge, so here a £1,000 could be saved each year alone from taking a pension with lower annual management charges.

Pension Holder: How comes the pension companies over charge?

Ryan Mellor: At the start of 2013, the Retail Distribution Review (RDR) ended commission based selling for financial advisors. (except insurance) This the biggest shake up  in financial services since Big Bang in 1986 . Prior to 2013, the IFA could have been motivated by placing your money in a scheme that paid him the highest commission. Now, the IFA under RDR has to charge for his or her advice in an upfront fee. His motivation now is to give you the best advice and locate pensions with low Annual Management Fees in order to satisfy compliance set by the FCA.

This is similar to using the services of an account or solicitor. However, the fee can be deducted from the principle, so you don’t have to pay for his services today.

With old fashioned pensions, (especially pensions from a decade or moreo ago) the chances are that your pension provider will skim up to a third of your investment returns from your pot through higher charges unless you do something about it.

This is because of the high back end charges that were applied to recover the commissions paid to the IFA upfront as it was effectively loaned to the IFA. Now this is either taken upfront or from the principle.

Pension Holder: Why do I need a review?

Ryan Mellor:  The IFA can in 8 out of 10 cases reduce the charges on your pension. In a recent survey (taken at the time of the appointment) 94% stated that the IFA could probably help them. See http://ifa-direct.com/wp/94-of-ifa-direct-appointments-stated-that-the-ifa-could-improve-the-performace-of-their-pension/

Only 45% of the UK population regularly review their pension. This is why the pension companies can get away with the high Annual Management Charges! Insurance is reviewed annually by around 80-90% of the population each year. Car insurance remains very competitive.

In the pensions industry the insurance companies know this and this is why they get away with the overcharges which can be very complicated to understand.

Pension Holder: Why is £12,500 the minimum?

Ryan Mellor: £12,500 is often the minimum as below this the benefits of the savings compared to the costs diminish rapidly. As a result many transfer requests are rejected by compliance which is there to protect the investor.

Pension Holder: Will my funds transfer being protected by the Financial Services Compensation Scheme?

Ryan Mellor: Yes.

Pension Holder: In summary what are the benefits?

Ryan Mellor: Top 10 Key Benefits are:
• Increase your final pension
• Check existing charges
• Reduce your charges
• Final pension projection
• Increase your tax-free cash
• Consolidate your existing pensions
• Up to date information
• Give yourself peace of mind
• Ensure your loved-ones receive the proceeds of your pension free of tax

Pension Holder: Do you have any testimonials?

Ryan Mellor: Yes look at our website.

This is updated weekly giving their responses to whether the meeting worked. You can also check us out on Twitter – which also includes client reviews.  http://www.twitter.com/ifadirecthome

Ryan Mellor, Co-founder at IFA Direct Home

If you are a financial advisor and you would like to work with us, please visit RMT Direct Leads.