By embracing technology, rethinking traditional retirement models and promoting financial literacy, you will be better placed to help people to navigate the challenges and uncertainties of the future with a greater sense of confidence.
We recently posted an article about the economic, financial and social pressures people are facing today, and the need for greater support, education and resources to help them retire with a future they’re comfortable with.
The Pensions and Lifetime Saving Association (PLSA) recently announced that retirement income for a “minimum” standard of living has had an alarming 38% increase to £14,400. If we combine this with an £1,800 shortfall between this income, and the full state pension of £12,800, this could be a recipe for creating additional stress and anxiety for the majority of people trying to not only make ends meet today, but worrying about their financial future.
While paying more into a pension is not quite possible for a lot of people within this economic context, it’s crucial that as retirement specialists and communicators we think about innovative ways to help people create a level of financial stability for their future.
Here are two solutions to help get you started:
1. Embracing technology
I've been fortunate enough to work with world-leading clients that use best practice solutions while embracing technological advances. A common thread among these clients is their desire to achieve "consumer grade" experiences. Meaning, expecting the same level of service as you would from industry-leading organisations outside of pensions.
In reality, these worlds don’t have to be so disconnected. Why wouldn’t people (who are used to online shopping carts, personalised suggestions and targeted reminders) want the same care taken to their retirement provider's communications? The truth is that they can, and some have done exactly this with great success.
Some ideas include:
- Smart marketing, personalised communication and clear calls to action: Consumer Duty requirements is helping to drive the industry into the 21st century in this space, and you can get ahead of the game by supporting people with targeted messages triggered when they take action, such as registering their online account or nominating a beneficiary. You can take these confirmations to the next level by having segmented 'next best actions' in other words, "see what people just like you are also doing."
- Using robo-advisors, modellers and apps: Telling members to do something can be powerful, but members doing something themselves is empowering. Tools which give members the ability to understand their own personal circumstances, and dig deeper into the impact of taking small steps now for their financial future can change habits for a lifetime. At Gallagher, we've seen great change when members use our Cost of Delay modeller, or see how much one bought coffee a week adds up to in retirement with our Small Change, Big Savings calculator. We're also seeing an increased role and use of robo advice, which can automate help for members who don't have time or aren’t confident using modellers.
2. Encouraging financial education
Providing educational resources and a greater understanding of the value of financial literacy can really go a long way. Removing the often confusing language of the investment world to ask a series of simple questions can help to reduce disengagement, which is quite common in this area. What's more, improving understanding can help boost the profile of a Trustee’s investment strategy and help them to feel more included in the investment strategies which have been designed with them in mind.
Other tools can be as simple as listening to "people like me" stories, videos and case studies – putting yourself in someone else's shoes or just having a sense that you're not alone can give someone the confidence to tackle the inertia of making changes now.
Importantly, financial education doesn’t have to be a burden. Simple and engaging tools such as checklists and quizzes can help build a story and direct someone to support and guidance. There's no reason why you can't start small – don't underestimate the power of a great search engine on a website, for example. It really doesn't take long for a user to give up on searching for something and either not take action or jump straight onto a helpline.
Now’s the best time to start!
By using these two goals, you can help people to create a more comfortable retirement. By embracing technology, rethinking traditional retirement models and promoting financial literacy, you’ll be better placed to help people navigate the challenges and uncertainties of the future with a greater sense of confidence.
Want to find out more?
Our team of pension communication experts can help you to define a communication strategy that works for your members’ needs. Contact us today.
