Consumer engagement with pensions rises despite only 13% receiving advice
14 Oct, 2024
Consumer engagement with pensions rises despite only 13% receiving advice
A new report from Boring Money shows that consumer engagement and activity is on the rise when it comes to pensions.
Auto enrolment continues to encourage pension ownership, and the report finds that:
75% of British adults who are not retired report having at least one pension
13% of pension holders report having received financial advice on their pension in the last 12 months
12% of UK adults report having a private pension
Although confidence remains low, with over 6 in 10 saying they find pensions confusing, activity and engagement is on the increase.
8% say they have consolidated pensions over the last 12 months, up from 5% in 2022
67% have checked an annual statement in 2024 compared to 59% in 2022
60% have logged into an online account in 2024, compared to 52% in 2022
This greater activity also extends to new pension account opening. 6% have opened a new private pension, up from 4% in 2022.
Holly Mackay, Boring Money CEO, comments
“Activity is up across the board over the last two years. People are looking at their pensions more, opening more accounts and also consolidating.
It’s great to see increasing engagement form consumers as pensions join the mainstream, very slowly taking their place as a ‘normal person’s’ product not a ‘rich person’s’ product. A side effect of this engagement is a greater retention problem for workplace pension providers, as newer ‘shinier’ retail offerings are more superficially appealing for the pre-retired cohorts, for whom the consolidation message is starting to get through.”
The report also shows the value of advice when it comes to feeling prepared to retirement. 8 in 10 of advised non-retired pension holders aged 55+ agree with the statement “I have a retirement plan and I’m confident about how I will fund my retirement”. This compares to fewer than half of those who have not had any advice on their pension in the last 5 years.
Consideration of financial advice remains strong and events such as the upcoming Budget are likely to further increase the need for advice. Nearly 1 in 5 of all non-retired UK adults aged 55 and above are considering taking financial advice over the next 12 months.
Mackay adds, “Although consideration of advice is higher, the impact of Consumer Duty and increased servicing costs will likely impact the availability of advice for the mass affluent. As awareness and engagement grows, so will the demand for help. This growth in awareness and need is an important factor for the ongoing Advice Guidance Review to consider.”
