 There are a number of profound changes to the pensions, and financial services, landscape that will be taking place in the course of the next two years and many of us will lose focus of these changes due to the impact of major events such as the Olympics in London in July/August 2012 to name but one, but it is extremely important to be aware of how these changes may affect you.Overlaying all of these changes is the fundamental change in how financial services advice is dispensed. In late 2008 the Financial Services Authority (FSA) announced that it would implement the findings of the Retail Distribution Review (RDR) and that this would be done in stages prior to a final implementation from 1 January 2013.
Three major changes result from the impact of RDR and these concern, Capital Adequacy, Qualifications, and the need for any advisor who wishes to remain independent to move to Fee Based Advice.
Capital Adequacy will involve all financial intermediary firms holding more capital reserves for any financial contingencies that may arise.
Enhanced Qualifications results from a desire from the FSA to see standards improve amongst financial advisors. At the moment the basic Financial Planning Certificate is all that is required to offer advice in most areas of financial services products. The FSA have stated that the new minimum benchmark qualification will be a Level 4 Diploma, but they have also added that they wish advisors to be qualified in the area in which they are called upon to give advice. Sounds an obvious move does it not, but you may be surprised at just how lacking some financial advisors are in the subject matter they are called upon to advise in. As yet the matter is still the subject of consultation and areas such as investment advice may require a specialised practicing certificate.
Fee Based Advice means that from 1 January 2013 any advisor who wishes to remain independent can only derive their income on a fee basis from that point onwards. This will result in a split in the advisor community, with some choosing to become independent professional practices and many choosing instead to become salesmen of products being limited to a small number of products, or a small number of suppliers. Many financial services 'sales' could be dealt with on a transactional or 'execution only' basis. | 
