Georgia Interviews...Nicola Downs





This month, Georgia Interviews...Director of independent financial advisers Trentham Invest, Nicola Downs, on her book about demystifying final salary pension schemes, and why she felt it was so important to share her knowledge with the wider world in a book format, specifically. 

You can watch the 11 minute interview in full in the video above, or read the edited write up below.


Georgia:  
Hi Nicola. Thank you so much for joining me today. I'm really excited to be talking with you about your book. Just say hello to everyone and start by giving us all a little bit of an overview of who you are and your business, Trentham Invest, and we'll go from there. 

Nicola:
Hello, Georgia. Very nice to meet you too. Trentham Invest is based in the Mole Valley in Dorking. It was started 13 years ago. Because we're in the Mole Valley, I wanted something that was synonymous with the local community. We're really known for our brand in terms of a mole. That's who we are. We've developed that and we're better known now for geese within our business. 

Georgia:
Fantastic. Thank you. I love the fact that because of where you're based, and how you're bringing the countryside and the community that you live in into your branding. It's really clever. So you've recently written a book. Do you mind telling us, first of all, what it's called and what it's about? 

Nicola:
The mole has developed and morphed into a goose. The reason for that is we have started specialising in pension schemes. With that, we've really drilled into a particular type of pension out of the number of pensions available in the UK and those types are final salary pension schemes. Listening to people over the years with the issues and problems, I was motivated and excited to write a book about the myths of final salary pensions and the options that people have.

Georgia:
That's amazing. Did you feel that was something, information, people didn't really have access to before? 

Nicola:
Yes. What inspired me was a particular experience, where I was the retirement or pension adviser specialist to this man, and his planning for his retirement. When he actually came to retirement, he was a member of a final salary pension scheme, but because he wouldn't have had the full 40-year service, he wanted to make additional voluntary contributions. He had a pot that was £800,000. He wanted to retire just after the age of 55, maybe approaching 56, and had gone to the pension trustees about his options for the pot. They went to Hargreaves Lansdown. They then got an illustration for him, gave him the illustration and the quotation. He had a look at that and thought, I'm only getting 2.5% return on my capital. In the event of my death, my wife will get half of that. That really wasn't good enough for him. He came to me and said, "You're the expert. You can do better." He showed me the illustration. I looked at that and I said, "I'm really going to disappoint you because the system that Hargreaves Lansdown would use was exactly the same research system as what we would use, and I couldn't do any better." So, faced with that problem, he then said, "But you're the expert. Surely, there's something else you can do." I immediately said, "What is it that you want?”, and he wanted maximum income for him, maximum protection for his wife, particularly in the event of his death, and flexibility of the money if anything happened. I said was that it, he said yes, and so told him there were two options. This was in 2007-2008. At this point, occupational drawdown had come into play. Personal drawdown has been around since 1995, but he needed occupational drawdown to achieve what he wanted to do. So I said, "We'll go to the trustees and ask them if they will allow this £800,000 to go into occupational drawdown." If that was the case, I could double his income. If they said no, which they were entitled to do, I said, "There's the nuclear option. In which case, we will sever everything from that scheme, including the final salary section, into a private arrangement." At that time, I said, "That's the nuclear option." He said, "How much could we get for the nuclear option?" I said, "About £1.2 million." We went to the trustees. They would not allow him into occupational drawdown. They wouldn't rewrite the rules. I had suggested they do that and gave them the words to do it. I've done that with another scheme a year earlier, when 2006 came in, but there was no way they were playing ball. I said, "Look, we need to go nuclear or even consider that," and the valuation came in at £1.7 million. I did a few calculations, I opened a spreadsheet, did some forecasting. It really was a no-brainer, and off we went. 

Georgia:
That's amazing. Those kinds of results, the way that you help these people, that's life-changing, isn't it, for him? Not just for him, but for his family and in terms of future planning. I just find it amazing that death is the only inevitable thing for all of us, but there must be so many people in his position who aren't able to maximise their situation. What I'm really intrigued to know is, what made you decide that writing for these people and putting all of this in a book was the most effective way to reach them and to help them with this information? 

Nicola:
As you say, it's life-changing. It was life-changing for him and his family, which is pleasing for me. I get a lot of joy from helping people make life-changing decisions. Putting this into a book, I wanted to reach a wider audience. I can speak to one person face-to-face, but by writing it down, my message gets to one to many, and putting real cases in there was really important to me. I've worked with a number of people since that early encounter, where the lifechanging transformations really are around increased tax-free lump sums. For that case I mentioned, he had an extra £100,000 tax-free cash sum. His pension income almost doubled for retirement. Instead of his wife getting just over £20,000 a year in the event of his death, she would get well over £1 million, maybe £1.3 million. 

Georgia:
Unbelievable. 

Nicola:
The issue is that people don't hear about this because the trustees aren't allowed to communicate these messages. They say to people you've got to go and get financial advice. They go and get financial advice. They go to an adviser, but most advisers look at a computer report. Those computer reports look at annuity purchase. People don't want to buy annuities in this day and age. They want drawdown. They want alternative options. If somebody wants to come out of a final salary scheme and buy an annuity, I would not transfer them out because that's what this man faced with his £800,000 pension pot, was buying an annuity. The old computer reports, we still have to do it for compliance. We have to do it for the regulator, but it's not what the people want. We have designed a unique method and a unique process to take people through alternative decision-making. We clearly do the compliance reporting as well, but we look at it from a different angle. Empower the people with different options and a system with freeing the geese. We are directly authorised with the regulator. We take responsibility. We put the client at the centre of the decision-making and not a computer report, unlike a lot of financial advisers. 

Georgia:
What's really evident in speaking with you is how you're combining your expertise with a very clear passion for helping people and for what you do. I'm sure there are a lot of people out there who would read your book and be very grateful that you've combined the two and actually made the effort to reach that wider audience and communicate the core of who you are. How do you feel communicating your values and your core message has benefited your business? 

Nicola:
I think people have been given a certain message. The beliefs are that final salary pension schemes are gold-plated. You can't lose. It's a guarantee. Why would you do it? There's nothing else better than a final salary pension scheme. There are no risks. Actually, there are risks in these schemes. They're gold-plated - they're not solid gold. The plate has fallen off a lot of these schemes. Inside, they're corroded. The holes are enormous. Maybe 50% of the pension isn't there, and people are not aware of this. I really wanted to educate, empower, and demystify all these myths that people have been brainwashed to believe. 

Georgia:
Absolutely. For people listening to this who have been or are being impacted, anybody who hears what Nicola's saying and it's resonating, can you tell them what your book is called and where they can find it? 

Nicola:
The book is called Your Final Salary Pension Options: The Truth Behind the Myth. You can find it on Kindle, and you can find it on Amazon or you can contact our office directly, and we'll send you a hard copy. 

Georgia:
That's fantastic. Thank you so much for taking the time to share all of that. I hope that you all go out and buy a copy of this book. I've read it. It's fantastic. It's informative. It's information you really can't get anywhere else. Thank you, Nicola. 

Nicola:
Thank you.
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