Tim Morris, independent financial adviser at Russell and Co, adds: “Clearly, they must be mindful of increased costs, with value for money being the key measure.”
For advisers, pension consolidation could be good news as it will likely trigger an increase in demand for advice.
Morris says he does not anticipate that pension consolidation will greatly affect advisers and how they manage their clients' pots of money, other than potential new clients who seek advice as the value of the pension increases.
He notes: "Making wise choices and seeking guidance tends to take prominence.”
James Murray says any client who wants to embark on a multi-DC pension consolidation is going to need a "serious" amount of time and energy to last the enduring road.
"Moreover, the pension consolidation is just merely administration and paperwork. What the majority of retail clients need in my experience is proper financial, planning and advice.
“For example, completing detailed cash flow analysis of how they remain on track for their retirement goals, adding in their lifelong goals and planned events in retirement, and even factoring the uncomfortable reality of home care costs and affordability.”
While pension consolidation holds many positives for consumers, the value of that consolidator's proposition is key to putting that money in the right place.
Webb says: “For the consumer, consolidation has the potential upside that you have all your pensions in a single, modern, good value DC arrangement with which you engage.
“But the risk is that the consolidation battle is won by the provider who has the best app or the best PR and not necessarily the one that will provide the best value.”
Ima Jackson-Obot is deputy features editor of FTAdviser
