From the blog: Throughout my 25-year career in pensions, there have been a few notable milestones and turning points.
A couple of significant moments that spring to mind include when Gordon Brown removed advance corporation tax relief for pension schemes in 1997 and when stakeholder pensions were introduced in 2001. The impacts in both cases were huge.
A couple of significant moments that spring to mind include when Gordon Brown removed advance corporation tax relief for pension schemes in 1997 and when stakeholder pensions were introduced in 2001. The impacts in both cases were huge.
Expect to see computer-generated avatars that explain savings performance
The industry has adapted to meet various new regulations and legislation, but it’s never been on the cusp of a revolutionary shake-up – until now.
Tight rules around pensions made it incredibly difficult for companies to innovate in the past, but with the arrival of auto-enrolment amid the digital revolution the industry is finally moving into the 21st century.
For the first time ever, pensions have the potential to be personal, and with that create better retirement outcomes than many enjoy even today.
Why? Technology is disrupting the workplace pensions space, making savings relevant for a generation that is not interested in filling out forms or posting paperwork.
The tech-savvy minds of today (and the future) are hard to engage with and even more difficult to hold down; it’s expected that they’ll have about 11 jobs in their lifetime.
If we're to turn the UK into a nation of savers, we all have to speak the same language across the same platforms.
The future is mobile
I can envisage a time when users open an app to manage all their finances. Perhaps it will know where you buy your coffee in the morning and push the pennies you save into your pension.
Or it could deliver deals that give you the option to save directly into your pot, not straight into your pocket.
In time, the firms that make the most impact on how successfully we save will be the ones that crack technology. Think instant balance searches, self-generated reports and changes to contributions, the ability to interact with and handpick funds – all via your phone.
Savers will be able to hear their performance reports as they drive to work. Expect to see computer-generated avatars that explain savings performance.
You'll be able to pick saving styles, make detailed investment choices and even consolidate small pots from different jobs into one place.
All of this will make saving more compelling, and it's my feeling this new generation will eventually have a much better understanding of their investments than previous, more apathetic ones ever have.
Technology will help them track pots quickly and efficiently, and they’ll be motivated by their own progress.
Pensions won’t be distant, dusty bundle of papers in the filing cabinet; they’ll be right there, in your phone.
Paul Budgen is director of business development at mastertrust Smart Pension
