'This warrants serious attention' – 'Shockingly few' Britons aware of new pension service

More than 20% of people have lost a pension pot says expert

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Pension dashboards are being worked on at the moment as the PDP aims “to enable individuals to access their pensions information online, securely and all in one place, thereby supporting better planning for retirement and growing financial wellbeing”. In recent years, the Money and Pensions Service (MaPS) established a team, lead by Chris Curry – a retirement expert with decades of experience – to design and implement the infrastructure that’ll allow users to find and manage all their pension pots in a single place.

However, new research from My Pension Expert has shown retirees are reluctant to embrace digital technologies such as these and indeed, many are simply unaware of what the dashboards are.

A survey of 1,185 UK pension holders has revealed a widespread reluctance from consumers to use technology to manage their retirement finances.

The results found:

  • Just 37 percent believe financial technology has made it easier to manage their finances
  • 60 percent of Britons oppose their pension provider using more technology to help them manage retirement finances digitally. This figure jumps to 78 percent among those aged 55 and over
  • Just 27 percent have heard of the Government’s pension dashboard, with even fewer (20 percent) understanding what it is and why it is being launched

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Pensioners

Pensioners are reluctant to embrace digital planning (Image: GETTY)

Additionally, the same research showed 84 percent of respondents did not believe the dashboard will change the way they manage their pension.

Understanding of the dashboard was even lower among the over-55s; only 13 percent of this demographic knew what the dashboard is and why it is being launched, with just five percent saying it will change the way they engage with their pension.

Andrew Megson, the executive chairman of My Pension Expert, commented: “Financial technology has the potential to transform the way people prepare for retirement – it can make it easier to track down lost pension pots, manage investments and access valuable information. However, our research shows there remains a reluctance to embrace fintech among pension planners in the UK.

“This warrants serious attention. Ultimately, both the pension sector and the government must take responsibility and educate the public – particularly older savers – about the benefits of using technology to manage their retirement finances.

“Hosting tutorials, or better promoting the benefits of digital pension management, for example, would be a positive start. Otherwise, we risk seeing generations of savers losing track of, or mismanaging, their pension. It is time for the pension sector, and pension planners, to truly enter the digital age.”

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Mr Megson went on to examine the potential of the Pension dashboards and comment on what needs to be done to improve awareness.

“The Government’s pension dashboard will be the most innovative development for the pension sector within the previous twenty years,” he said.

“It has the potential to transform Britons’ engagement with their retirement finances. It is, therefore, a tragedy that shockingly few – 16 percent according to My Pension Expert’s research – understand what it is and why it’s being launched.

“Ultimately, the Government has a responsibility to not only raise awareness of the Dashboard, but inform savers exactly how it will benefit them. Uploading factsheets to the Government’s website or investing resources into a promotional campaign would be a good start. It may seem pre-emptive, given that the launch is not scheduled until 2023, but, without establishing strong foundations of understanding or awareness, they risk the launch being a damp squib.

Retirement

Retirment prospects vary across the UK (Image: EXPRESS)

“That said, the financial services sector cannot afford to be complacent in these efforts. Indeed, regulatory bodies have a duty to promote any efforts to increase pension engagement. Again, making information about the benefits of the dashboard more accessible will be vital – hosting workshops and tutorials (live or virtual), for example, would be incredibly beneficial.

“Likewise, independent financial advisers should incorporate fintech education into their advice. Encouraging clients to ask questions and explore the various ways in which they could benefit from the Dashboard, or indeed fintech in general, could transform the way they manage their retirement finances.

“It will take a cross-sector collaboration to ensure the success of the Pension Dashboard, and ultimately, this will come down to whether Britons have access to the right information.

“Otherwise, they will likely remain oblivious to the benefits the Dashboard could offer.”

In late July, the PDP released an update on where the organisation is with its plans and following qualitative user research, it noted there was “widespread, positive reaction to the concept of dashboards”.

However, it acknowledged work needs to be done to raise awareness and understanding of what the dashboards can offer.

The company said: “We know that many people will need help with interpreting what they see. The discussion about estimated retirement income and exactly what information dashboards will display is ongoing but we know that many people can find the figures confusing. So we’re looking at developing tools and digital guidance that wrap around the dashboard, and at signposting to other guidance and advice services.

“It’s early days but we see the pensions dashboard as a digital entry point to all of MaPS other services.”

In response to these findings, a DWP spokesperson said: “Information about the dashboards programme is already available online and we will promote our consultation on proposed regulations for pensions dashboards later this year, before laying draft regulations in Parliament for debate in 2022.

“Pensions dashboards will revolutionise how savers access their pension information by allowing them to see what they have in their various pensions – including their state pension – in a single place online, via their digital device, at any time they choose. This will put the saver in control, transforming how consumers think and plan for their retirement.”

Express.co.uk contacted the PDP for comment.

Harry Byrne

Harry Byrne

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