Millions of savers will be helped to get to know their pensions better – and perhaps build a bigger retirement pot – with a new awareness campaign launching later this year.
Only one in five (20%) people feels confident they are saving enough for their retirement, according to industry figures.
The drive to help bring retirement savings into everyday conversations is being led by the Association of British Insurers (ABI) and the Pensions and Lifetime Savings Association (PLSA) and is also backed by several big pensions providers.
It is hoped people will be encouraged to engage more with existing pensions communications and to save more to achieve a higher income in retirement.
People may also feel encouraged to review their retirement options, consider opportunities to consolidate their savings, and see how and where their pension is invested.
Significantly, 15 providers and schemes representing around 41.5 million savers and customers have committed to support the campaign.
Sponsors include Aviva, Standard Life (part of Phoenix Group), Royal London, Scottish Widows, Fidelity, L&G, Nest, Pru (part of M&G group), Smart Pensions, the People’s Pension, and Now: Pensions.
Supporters also include Hargreaves Lansdown, Railpen, USS and Just.
This concerted action will reach tens of millions of savers who are in automatic enrolment schemes, defined benefit (DB) pensions, self-invested personal pensions, and those who have started withdrawing money from their pension, those behind the initiative said.
Savers want simple, jargon-free information to help them get their pension savings working for themNigel Peaple, PLSA
Nigel Peaple, director of policy and advocacy at the PLSA, which previously launched “retirement living standards” to give savers a rough idea of how much money they may need for a comfortable retirement, said: “We have seen from the level of engagement with our retirement living standards and the national conversation it started, that savers want simple, jargon-free information to help them get their pension savings working for them.
“By committing all corners of the pensions industry to pull together on a concentrated engagement campaign – and with the support of the Department for Work and Pensions – we have the potential to move the dial in helping savers understand their pension so that more people have a better income in retirement.”
The campaign will run in the autumn/winter of this year and aims to help people understand the basics of pensions.
Resources will be made freely available for use by all those who wish to participate across the pensions industry, including employers, regulators, and government departments.
Seven out of 10 people find pensions overly complex and difficult to understand. This needs to change, fastYvonne Braun, ABI
Yvonne Braun, director of long-term savings policy at the ABI, said: “We know that seven out of 10 people find pensions overly complex and difficult to understand. This needs to change, fast.
“Uniting pension providers and schemes around an engagement season focused on pension basics could have a real impact on people’s understanding of the importance of their pension and prepare the ground for pensions dashboards. It will also complement the Government’s drive to increase engagement, which we wholeheartedly support.”
Savers will be able to see the campaign in different places, for example on social media and in communications from their pension schemes.
It will share tips on how to identify who your pension providers are, make sure contact details are up to date, and check how much you have saved towards retirement.
It will also help people prepare for pensions dashboards, which will eventually show savers all their pension pots in one place.
Pensions Minister Guy Opperman said: “I warmly welcome this campaign from the ABI and PLSA and look forward to working together – and with other industry partners – to help bring about a step change in how the record number of Brits now saving for retirement engage with their pension.”
Phil Brown, director of policy at B&CE, provider of the People’s Pension, said: “Since automatic enrolment was introduced nearly 10 years ago, more than 10 million people have been brought into pensions saving, making it all the more important that the message from providers is both consistent and straightforward.”
Helen Morrissey, senior pensions and retirement analyst at Hargreaves Lansdown, said: “Auto-enrolment got people saving but without engagement many people still won’t get the outcomes they hope for in retirement.
“Simple things like checking your pension value, revising how much you put in and getting the right investments for you can have an enormous impact, and yet not enough people are doing it.”