Hughes says another concern for clients is the UK lifetime allowance for tax-free pension savings, which has been slashed twice in recent years. In 2011 it was cut from £18m to £1.25m, and this year it was cut to £1m.
Hughes warns the current cap is now too low and that the UK chancellor Philip Hammond could seek further reductions to offset the cost of tax relief for pensioners. Hughes fears further cuts to the allowance could skew the market.
“Investors are having to look for alternatives to pension products, to other tax-efficient investments vehicles that might be appropriate,” he warns.
Career development
Working with “really good quality people” has been the cornerstone of his near 20-year career in financial services, says Hughes.
He describes how he “fell into financial planning”. After studying business and law at the University of Derby in the early ’90s, he initially pursued a career in retail, becoming assistant store manager at the retail giant Toys ‘R’ Us.
Growing tired of anti-social hours in the retail sector, in 1997 he joined insurance behemoth Prudential, although he was sceptical that it would turn into a long-term career. “Along with many other people who fell into financial planning at that time, not many regarded it as a genuine graduate career,” he says.
However, having graduated from Prudential’s training programme with a Financial Planner Certificate (FPC), Hughes moved to Wesleyan where he “learnt how to be an adviser”. Determined to become an independent financial adviser, he then moved on to the Royal Bank of Scotland (RBS) in 2000, rising through the bank’s IFA arm to become head of business for the Midlands and Wales.
During his 12-year tenure at RBS, he also developed the bank’s post-retail distribution review model. But his greatest achievement, he says, was developing talent.
“At RBS we developed a number of advisers from the basic FPC qualification all the way through to diploma, then on to chartered status. I like to work with people who want to develop into the best advisers they can be,” he says.
In 2012, Hughes was headhunted by Barclays to launch a corporate wealth and advisory business. Building the business from scratch, the father-of-two says his time at Barclays taught him how to “create a really great client experience” as well as developing the industry’s “top talent”.
“I was fortunate to work with some really strong people at Barclays. We built a business and I led its regulated corporate arm. We built a really good digital auto-enrolment model that worked very well for our clients,” adds Hughes.
However, in March this year Hughes was tasked with closing the advisory unit after Barclays decided to move away from its non-core business ventures, a strategy that has been replicated by many leading banking and insurance firms in recent years.
“Our business was a very strong financial planning and employee benefits business, but Barclays made the decision that it wanted to focus on banking,” he says.
Hughes says his experience of promoting standards of excellence throughout his career stands him in good stead for his role at Mercer Jelf. He adds the industry as a whole must do more to develop the next generation of financial planners by promoting the profession as a “genuine career path”.
