On the go: The Financial Conduct Authority will carry out an investigation into the suitability of pension decumulation advice.
In its business plan for 2020-21, published on Tuesday, the regulator said one of its key priorities was making sure consumers were able to make effective decisions in the pensions and retail investment markets.
The FCA stated: “Our view is the investment distribution process, and the support network around it, is not working well enough for consumers to make effective decisions about their investments.
“We want consumers to have access to high-quality advice and support, and be aware of how to protect themselves from scams and fraud.”
The watchdog said it would continue to assess the suitability of defined benefit transfers, but would now also start assessing the suitability of decumulation advice as well.
“At present, we see significant risk of harm in [the pension and retail investment] markets, in part driven by the way consumers have been given additional responsibility for complex investment decisions, through the shift to defined contribution pensions and the government’s 2015 pension freedoms,” the regulator said.
“Consumers are also exposed to significant market volatility caused by coronavirus. We want to make sure they are supported to make effective investment choices in a fair market.”
To help tackle this, the FCA is proposing a consumer harm campaign to help consumers make better-informed investment decisions.
This article originally appeared on FTAdviser.com
