COVID-19 and social distancing measures have created a huge opportunity for retirement fintech platforms, but there still remains one obstacle standing in the way – indifference.
Although innovations like the Government’s pension dashboard, which will be ready for release in 2023, stand to completely transform savers’ relationship with their retirement finances, evidence suggests that many individuals might need some more convincing. According to our recent research, just 20% understand what the Government’s dashboard is and why it is being launched. Likewise, a staggering 84% do not believe the dashboard will change the way they manage their pension.
This is surprising, especially given that the platform will enable savers to view and manage all of their pension information from one destination, as well as the ability to chase up missing pension pots with ease – something that has, up until now, been mired with difficulties.
Clearly, greater action must be taken to boost consumer awareness about the dashboard, as well as fintech more generally, to set savers on the right path to retirement.
What is holding savers back?
First, it is vital to understand why individuals are so reluctant to embrace new fintech developments.
This apathy can be largely put down to the fact that the project has been subject to a number of delays, which are unlikely to inspire much confidence.
However, it is important to note the fact that Britons’ indifference towards retirement fintech seems to go far beyond just public sector schemes. Indeed, the majority (60%) of respondents to My Pension Expert’s aforementioned survey opposed their pension provider introducing more fintech solutions to help them manage their pension online.
Given the fact that retirement poverty is a growing problem in the UK, with almost two million of today’s pensioners earning less than 60% of the UK’s average income, every penny counts at retirement age. Consequently, it is very concerning to see that the launch of the Government’s platform seems to be falling on deaf ears, given that the incentive is likely to go some way towards improving this state of affairs.
A cross-sector effort
Ultimately, the Government has a responsibility to ensure that individuals are aware of the launch of their pension dashboard, as well as understanding how they will gain from the platform.
For example, it would be a positive start to see the Government being more forthcoming with information about the platform, whether this constitutes educational resources on their website, or investing resources into promotional campaigns and tutorials, to show individuals how to use it. This may seem premature, given that the dashboard doesn’t launch until 2023, but it will be a vital help for users, providing them with the firm foundations required to use the platform before it comes into place, as well as ensuring that the launch doesn’t fall flat.
Likewise, the financial services industry cannot afford to be complacent when it comes to launching the platform, either. Where regulatory bodies are concerned, there is also a duty to promote Government efforts that aim to increase pension engagement. As such, making information about the benefits of the dashboard more accessible will be very important indeed – hosting workshops and tutorials (live or virtual), for example, would be incredibly useful.
Meanwhile, independent financial advisors should focus on incorporating fintech education as a part of their service – encouraging clients to ask questions if they are unsure and offering advice as to how individuals can best leverage the dashboard to their advantage, for example. Indeed, at My Pension Expert, our team of advisers encourage clients to quiz them about the various ways in which fintech can enhance the management of retirement finances. Our team are constantly reviewing and analysing the latest fintech developments and are well-equipped to answer any pressing questions clients may have about how they could benefit from them.
Of course, there will be no quick fix to improving Britons’ trust in fintech, particularly when it comes to managing retirement finances. However, with improved access to information and open conversations with experts, an increased uptake in retirement fintech could be within the realms of possibility.