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Under Wealth Builders, Kevin is providing an education service and should not be giving specific financial advice, and there is / would be no need to be regulated. It is also creating a community to match-make those looking for funding with those who have funding - in their pension.
I would have thought, however, that it was prudent to make clear that the firm is not regulated by the FCA ... blah .. blah .. blah, as they are unable to give advice and can purely provide education and non-specific guidance (whether they stray from this in reality is arguable or not known).
I would certainly have some form of disclaimer if it was me, to make it clear.
Kevin is an experienced business person who has been the director of a regulated IFA firm for many years (albeit not a qualified IFA himself, he has an economics degree I believe - not sure if that alone makes him an economist!?!)
Kevin also is an owner of the trustee company Empowered Pensions and Empowered Training who provide the trustee training
This means he owns:
- the education co. - SSAS experts - and promoting the SSAS vehicle
- the regulated IFA, and maybe this is the firm that would carry out any pension transfer advice into the SSAS from a final salary (or defined contribution) pension scheme
- the SSAS trustee, that administers the scheme - I cannot work out whether they take the role that carries liability for decisions made in the SSAS ref. types of investment and whether they are compliant, etc. or whether they just carry out the admin duties like a services provider with no liability (there is quite a difference)
- the training co. that provides training to help you carry out your duties as a trustee of your own scheme - I have no idea how it compares to the free training here https://trusteetoolkit.thepensionsregulator.gov.uk/
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I am a fully authorised & regulated financial planner / IFA (not touting for business BTW). I have also been an HMO property investor for the past 9 years with a decent sized portfolio.
This post is not aimed at any one company or provider of services in particular, but a general observation of what I have seen.
There are many of us in the regulated world who have deep concerns about the activities of unregulated introducers - there have been a number of high profile issues with investments that have been "recommended or introduced" by these co.'s individuals / Co.'s that have gone south - the biggest being London Capital & Finance mini-bond that collapsed with £200+ million of investors cash in the last few months. Very large commissions are paid to these salespeople acting as "advisers" ... and there is zero redress to investors as they are not regulated by the FCA (albeit their unregulated status is often not made clear, or if it is ... the implications of their unregulated status isn't)
This is obviously at one end of the scale.
There are further concerns at the other, where there are unregulated introducers working generally with one (or a small cartel of) IFA firm who "help" people unlock their final salary / defined benefit pension and place it into a SSAS.
Often you find there are links between these firms either in ownership & control, or perhaps just an uncomfortably close relationship that in my view creates a conflict of interest for the IFA firm that is ignored, and often the advice may be "independent" of a product provider as the words Independent Financial Adviser (IFA) mean ..... however I'd question if the advice was impartial.
The funds are then in the least regulated of all pension schemes (there is a reason why the SSAS is the pension scammers vehicle of choice) and is ripe for picking with all sorts of investments, many unregulated - these include mini bonds, loans to other property investors, hotel rooms, student pods, storage, car parking spaces .... you name I've seen it.
Whilst a SSAS can be an immensely powerful vehicle in the right hands, it can be a very destructive power in the wrong hands, or should I say if following the wrong guidance or taking the wrong path.
Many people get caught in some of these sophisticated sales funnels via networking groups & facebook groups that again look impartial and seem good sources of further shared knowledge and education.
Within these groups, I have also seen lots of "personal recommendations" by individuals that normally end in "talk to me offline if you would like to understand more about my experiences" and again often there is a relationship between the person sharing their experience and the firm they are talking about (whether that be direct monetary, or just introductions to further investors when they require money for their own projects). Again, impartiality can be conflicted here as this is often not disclosed.
The groups, etc are often just a feeder into the connected companies who might offer:
- education via their training co.
- an intro to an "Independent" IFA (but I'd question whether they were an impartial one)
- an intro to an "independent" trustee to run the SSAS pension scheme (again, questionable how independent and impartial they are when they could be in the same ownership)
- expensive training to become a trustee of your own scheme, when it is freely available on the Pensions Regulator site https://trusteetoolkit.thepensionsregulator.gov.uk/
and ultimately it is often a way to unlock pensions monies into a more "flexible" pension which I then often see loaned out to other property developers and investors as a main goal.
This opens up its own can of worms to do with strength and risk of this investment ... etc .... etc.
For some, this is a suitable route.
For many, it is not. As they are often heavily invested in property themselves personally, and are then generally going all-in with their pension investments into property too - so no diversification whatsoever.
I am also seeing loanbacks - one of the benefits of a SSAS scheme, but have specific criteria you need to meet and many cannot in a compliant way - being completed from the client's SSAS pension back to their Co. that would not pass further investigation by HMRC often due to concerns over the security given for the loan.
Again, in the right circumstances, loanbacks can be a powerful vehicle in property investment .... but the circumstances are quite specific and many do not fit them for the loan to be compliant.
Within the SSAS pension scheme, there must be a Scheme Administrator, which is an official position that takes on some liability for activities carried out by the pension scheme. I am seeing a lack of clarity whether a service provider is taking on this position officially and hence the liability or whether they are just providing outsourced administration services for the pension scheme and hence have no liability for anything that is not compliant in the scheme and that sits with the trustees - the actual pension holder(s).
This is pertinent with the potential issue described above regards loanbacks.
As I say, for the right people with the right circumstances, a SSAS can be a suitable pension vehicle. Then there needs to be ongoing discussion and advice around suitability of investments.
I have seen many within these groups state "I spoke to an IFA and he didn't seem to get the whole SSAS thing", but quite often what I am seeing is that the IFA will not do the work to transfer the final salary pension as he understands that for many people it is not in their interest to do so and would not be deemed suitable under FCA guidance.
The route to successful (but not necessarily suitable) transfer often leads back to 1 or 2 specific IFAs.
In some cases, I feel that the pension holder almost needs saving from themselves, and what they are wanting to do is not in their best interests. This is often the role of an independent and fully impartial financial adviser.
Most IFAs are very market funds centric
The introducers and education co. side of things seem to pretty much shun traditional market funds and push people towards third party loans and other debt related schemes (lending to a German co. that refurbishes listed buildings in Germany is one I have seen, and there are many who have invested that are no longer receiving interest on their investment)
I very firmly sit in the middle and believe there is a need for traditional market investment where suitable, together with potential property and property related activities.
At the end of the day, although I see the SSAS pension being marketed as this amazing new discovery for building wealth, it is at the end of the day a tax wrapper and financial product.
A financial product is a tool in the bag of a decent financial planner or adviser, but it a tool.
What most people need is a full and better understanding of their financial life, that will lead to better money decisions ... and may lead to them requiring a financial product, or not ... whatever the case may be.Heather, interesting that you use the word cult .... as some I have spoken to share that assessment.
Sorry for the long post, but hope it gives you some useful comment and observations.
Thank you Jon for such an in-depth post.So I guess the answers to my questions are:1. No.2. Yes.?????
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I can vouch for Kevin Whelan offering a legitimate service.
I've met with him in person on a number of occasions and he has briefed the front office team at Nova on the potential benefits is SSAS pensions for business owners. He has dealt with a few of our clients and we've always received good feedback. See below a link to an episode of my TV show, Proper Wealth on SSAS pensions;
He clearly knows what he is talking about and although he may advertise on social media (as do most of us) I wouldn't call him a social media marketeer.
I hope this is helpful and I'm happy to answer any further questions.
There is a whole chapter in my recently published book on Pensions and SSAS and the book is now International Amazon #1 best-seller. It's called The Property Pension Plan, Financial Freedom Through Buy to Let Investing, it may be of interest to anyone interested in Property as an alternative to pensions or using pension funds for property investment through a SSAS;
Nova Financial Group is my business and we assist clients with such as;
I can be contacted directly on firstname.lastname@example.org or call our office on 0203 8000 600. You can learn more about us here; https://www.nova.financial
I look forward to hearing from you.
Founder & Managing Director
Nova Financial Group