“In 2020 it cannot be acceptable for anyone’s pension records to only be stored physically. We fully support the PDP’s aim of enabling individuals to retrieve their pensions information online. To achieve this digital data access should be standardised, and data should not only be accurate but securely and easily accessible. Customers and advisors must be able to access this data electronically, within just a matter of days, and without the need for wet signatures. Data standards and security are vital to the pension dashboard’s successful delivery. They will enable it to work effectively, help solve the issue of ‘orphaned pensions’ and also allow better guidance to customers across the financial services industry.
“Too many people are simply not saving effectively for retirement and the financial advice needed to solve that is not accessible or practical for the masses. Digital guidance can solve this. It can carry customers through the accumulation phase until the point of retirement when a major decision is needed and advice becomes appropriate. To do this effectively, however, and enable the right guidance, access to complete, or near complete, customer data is needed. The pension dashboard will make this easier. But, only if the data is digital and readily available.
“Getting this right this will also benefit advised customers. New client onboarding processes and annual reviews are slowed down by the lack of ready access to complete data. It’s frustrating for both advisors and their customers and results in in higher fees and less capacity for advisors to help new customers. As a consequence, there’s a high threshold on the investable assets a customer must have before an advisor can look after them. For too long this has been an unnecessary barrier to enabling customers to achieve good outcomes from their retirement savings. Lower cost advice could be available to more people, those who really need it, if pensions data was complete, digital and accessible in an easy to understand form for advisors.
“Without rapid progress on ensuring every customer’s pension record is accurate and accessible digitally, the pensions dashboard will not be able to succeed and the benefits to advisors and consumers won’t be achieved. But for it to work well it is important that standards and technology requirements are set as quickly as possible. This will enable those pension administrators and providers, who have to deliver the data, enough time to get it established and for the needs for any data cleansing to be agreed with pension trustees. These are the biggest tasks ahead for pension administrators and providers.”
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