Simplification is the key - Centre for Policy Studies

segregated from any employer-sponsored scheme; portability issues (i.e. job mobility)
would disappear, reinforcing the platform’s lifetime theme.
A single platform would greatly enhance savers’ access to portfolio information and
enable providers to reduce their administration costs (Chapter 9), leading to less erosion
of asset value. The tools currently available for portfolio management would allow the
total accumulated funds in pension, ISA and other funds to be aggregated to show what
level of post-tax retirement income they may deliver (see also Section 10.2). When
retirement is reached, the ISA and pension savings could then be pooled to produce an
integrated income stream that could be managed to suit the saver’s income needs and
tax position.
Appendix VII provides a vision of how someone may, in future, interact with a financial
planning website. The technology to achieve this is readily available, and a number of
providers are currently developing websites to offer this sort of capability to their
customers.
8.5 Lifetime saving: easy to understand
Surveys conducted by major providers have found that the concept of lifetime saving is
easy to understand, the positive sentiment increasing with income. It particularly appeals
to women and the younger age groups, the two groups that surveys have found to be
most out of touch with pension saving. Indeed, younger females (aged 25 to 34) emerge
as having particularly weak knowledge of pension position.
“Flexibility”, “control” and “instant accessibility” are seen as particularly salient messages
in respect of encouraging people to review their savings and think about their potential
retirement income. Respondents indicated that they would be much more likely to use a
lifetime savings platform than a collection of disparate accounts (three times the industry
norm for new concepts), and would also invest more, by about 14% on average (when
compared with contributions into company pension schemes). The main negative
responses concerned inertia and cynicism about cost, mostly from the hardest to reach;
older respondents with minimal financial assets.
The surveys also suggest that the ability to view and analyse all of one’s assets in a
single document (or website) is appealing, particularly if a simple tool (ideally online)
were available to assist the planning of where, financially, the saver may want to be at
some future date. This should include the ability to project the effects of different asset
allocations and performance scenarios.
Analytical tools aside, a single platform would offer other, more basic, attributes. Survey
respondents like the prospect of being able to receive a variety of reminders, such as
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