You are here: Home - Retirement - Retirement planning - News -

Retirees to get clearer communications on pension choices

Written by:
Pension savers will receive simpler, clearer communications from the government’s Pension Wise service about their options at retirement, allowing them to make better decisions.

The new communications have been devised after trials with the Behavioural Insights Team on behalf of the Pension Wise service and in conjunction with LV=, Standard Life and Royal London. It used actual customers approaching retirement and ran a series of tests to see what, if anything, improved engagement.

For example, in one test, the standard ‘wakeup’ pack from a pension provider was replaced with one side of A4 that included all the essential information that a customer needs to access open market options, and a clear call to action around next steps – a ‘Pension Passport’. This increased visitors to the Pension Wise website by around 10%.

The survey was prompted by a Financial Conduct Authority (FCA) report in 2014. It surveyed pensioners at retirement and found that one of the top reasons for not shopping around for an annuity was that they did not feel capable of understanding the vast amount of information available in order to make an informed decision. Following the publication of this research, it is now expected the FCA and Department for Work and Pensions (DWP) will now push the pensions industry towards simpler communications as soon as possible.

Tom McPhail, head of policy at Hargreaves Lansdown, said: “This evidence confirms what a lot of businesses probably knew already; customers are more likely to act on simple, clear concise information, whilst lengthy complicated documents tend to cause customers to disengage. Given this evidence we hope all companies will now adopt a simple, Pension Passport type approach to help their customers make good decisions with their retirement savings. Where necessary, the FCA and the DWP should intervene to ensure all pension providers adopt this approach.

“Most people know how much is in their bank current account and how much their property might be worth; hardly anyone has even a vague idea how much their pensions are worth until they are almost ready to retire. This has to change. All investors who are approaching the age at which they might draw on their pension savings should take the time to explore their options.”

There are 0 Comment(s)

If you wish to comment without signing in, click your cursor in the top box and tick the 'Sign in as a guest' box at the bottom.

Are you a first-time buyer looking for a mortgage?

Look no further, get the help you need by searching for your perfect mortgage

Five ways to get on the property ladder without the Bank of Mum and Dad

A report suggests the Bank of Mum and Dad is running low on funds. Fortunately, there are other options for st...

The essential Your Money guide to the April 2018 tax changes

As we head into the 2018/19 tax year, a number of key changes take place to existing policies while some new i...

A guide to switching energy provider

All you need to know about switching from one energy supplier to another.

What will happen if rates change

How your finances will be impacted by a rise in interest rates.

Regular Savings Calculator

Small regular contributions can build up nicely over time.

Online Savings Calculator

Work out how your online savings can build over time.

Having a baby and your finances: seven top tips

We’re guessing the Duchess of Cambridge won’t be fretting about maternity pay or whether she’ll still be...

Protecting family wealth: 10 tips for cutting inheritance tax

Inheritance tax - sometimes known as 'death tax' - can cause even more heartache for bereaved families. But th...

Travel insurance: Five tips to ensure a successful claim

Ahead of your summer holiday, it’s important to make sure you have the right level of travel cover or you co... Awards 2018

Now in their 21st year, our awards recognise the companies offering the best products and services to consumers

Money Tips of the Week

Read previous post:
£600m court case against Lloyds Banking Group begins this week

The court case brought by a group of former shareholders in Lloyds TSB against Lloyds Banking Group and some its...