As the government debates new pension arrangements to encourage greater certainty for savers, new research published by NEST shows that pension providers must seek to understand the root causes of savers’ concerns and tailor products and communications accordingly in order to build trust and confidence in pension saving.
Improving consumer confidence in saving for retirement unpicks what lies behind consumers’ attitudes to pensions, their appetite for greater certainty of outcome and what they are and are not prepared to trade off to achieve it.
It also explores how an understanding of savers’ fears and expectations can help providers develop communications that mitigate potentially harmful emotional responses to risk and investment. Through this understanding providers can help savers achieve healthier outcomes and design products that better meet their needs.
Tim Jones, chief executive of NEST, says:
‘Automatic enrolment continues to gain momentum with over 3 million more people saving for their retirement as a result. As an industry we are increasingly challenged with meeting the needs of this new and growing generation of savers and developing products that are aligned with what they want and need. Our research suggests that a key missing element is how we bring this new generation into a conversation that has previously excluded them.
‘The new freedoms announced in the Budget have reaffirmed the importance of communicating effectively with members, encouraging better decisions and designing products that better meet savers’ needs. From next year the choices available to savers broaden considerably and the need for providers to reflect this is one the industry as a whole is investigating right now. To do this successfully we must understand consumers’ anxieties, aspirations and expectations; and design and communicate products in ways that are meaningful to them.
‘As an industry we need to find innovative ways of providing greater certainty for savers, but without high charges and without foregoing inflation-beating growth. We also need to find ways to help consumers feel they are at the heart of a debate that is about helping them achieve their retirement goals.
‘Improving consumer confidence in saving for retirement explores what consumers think and feel about pensions, investment and long term saving, providing insight into how we may not only provide improved product solutions, but also influence their attitudes and behaviour to support better outcomes for all.
‘We hope publishing these findings will help us, and others, advance design, engagement and innovation to instil more trust and faith among the millions of new pension savers automatic enrolment is creating.’
To view the full report click here
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