- Over one-fifth of Brits (21%) say an online Pensions Dashboard would most encourage them to save more for retirement, as McVey gives it the nod to move ahead
- Younger people far more open to using innovative technology like AI to save for the future
- More than half of adults (57%) not currently prepared to trust pensions and retirement planning advice from a robot
- Views on use of tech in retirement savings vary widely according to age, but support for dashboard is relatively consistent.
LONDON – The majority of adults in Great Britain (57%) would not trust retirement planning and savings guidance from a robo-adviser. However over one fifth (21%) said having a Pensions Dashboard to manage all of their pensions would be the online technology that would most encourage them to save more money for retirement, according to a new survey from pensions consultants LCP and research analysts YouGov.
The figures indicate that technology can unlock greater engagement on retirement savings, but that this ‘tech revolution’ must come in stages.
Among the key findings of the online survey are:
- While almost two-thirds of Brits would not trust robo-advice on retirement planning and savings advice, this scepticism appears to have a lot to do with age, with millennials generally indicating greater openness to the application of technology when it comes to financial advice and retirement planning.
- Overall, almost a third of people (28%) surveyed said they would trust this advice given to them by a robot, but in the 18-24 age bracket, trust climbed to 45% (compared with 38% who wouldn’t trust). In contrast, less than a fifth of respondents aged 55+ said they would trust robo-advice on retirement planning and savings advice (19%), compared with 67% who wouldn't.
- The fact that tech-savvy younger generations are more open to robo-advice is not surprising. Crucially, however, support for the Pensions Dashboard as the online tool most likely to encourage people to save more for retirement was not age dependent, with similar levels of interest from all age groups (18-24: 20%; 25-34: 26%; 35-44: 22%; 45-54: 24%; 55+ 17%).
- When it comes to technology more widely, 13% of UK adults said a smartphone app that made it easier to top up their pension would be the online technology most likely to encourage them to save more for retirement. But, here still there were large disparities when it came to age. Nearly a quarter (24%) of 18-24 year olds chose the smartphone app option, compared with just 4% of those aged 55+.
The Pensions Dashboard is among the most highly anticipated technological innovations, and this support for the dashboard comes at a critical time. The Secretary of State for Work & Pensions, Esther McVey, recently announced that the UK Government has handed over the project to industry to take forward, after previous fears it would be scrapped entirely. The dashboard would allow people to view all their pension pots in one place, from State Pension entitlements to defined contribution and, eventually, defined benefit schemes.
Bob Scott, senior partner at LCP, said:
“Technology continues to fundamentally transform nearly every aspect of the world we live in, and clearly that’s no different when it comes to some of the ways in which we plan financially for retirement. There may be some scepticism around innovations such as robo-advisers, but the survey results indicate that younger generations appear to be ready to embrace the power of technology when it comes to financial management and retirement savings. Advisers and providers therefore have an incentive to harness the benefits of new technology in order to cater to the next generation of savers and retirees, and to engage these future pensioners at an early stage.”
“More immediately, the prospect of the long-awaited Pensions Dashboard finally coming to life is welcome news, not least because the British public has shown a real appetite for such an innovation. With a sizable number of adults saying that it would help them to save more, it could prove to be a compelling case study of just how powerful the application of technology can really be when it comes to making retirement saving easier – and more universal – than ever before.”
“The use of technology like the dashboard, coupled with auto-enrolment, has the power to drive not just awareness and interest but, crucially, savings levels. There are very few who think a working dashboard wouldn’t bring considerable benefits, once it gets off the ground.”