Enhancing consumer engagement essential to drive positive retirement outcome
TISA, the investments and savings membership organisation, is broadly in support of the measures proposed in response to the findings of the FCA Retirement Outcomes Review. However, in its response TISA stresses that the focus must be on promoting positive consumer outcomes, particularly for those who do not have sufficient knowledge or confidence to make decisions and who are therefore vulnerable consumers.
Renny Biggins TISA’s Pensions Technical Officer said:
“Relevant information and guidance for consumers should be embedded throughout the accumulation lifecycle. In the years preceding the minimum retirement age we recommend warm-up packs be issued containing sufficient detail to prompt the consumer to start considering when and what they plan to do with pension funds and signposting where to go for guidance or advice.
“We agree with the proposal that decumulation investment defaults should exist as they do for accumulation. Bearing in mind the investment and longevity risks associated with Drawdown, we see the concept of default investment pathways as a positive move that would provide a level of protection to consumers. Especially taking into account the increasing number of retirees we shall see from workplace schemes in the coming years.
“These changes would also help to address the negative perceptions that many consumers have of the pensions industry. There is clearly a need to enhance confidence levels to enable people to save with certainty and encourage engagement.
“However, there is also a pressing need for further education. This would help those consumers who, on reaching retirement age, make decisions on moving their pension funds to alternative wrappers or savings vehicles to identify the potential consequences.”
TISA’s full response is available on the website: Response
Ends….
For further information please contact:
Alistair Kellie – Telephone: 0207 680 6558/Email Alistair.Kellie@newgatecomms.com
Sara Neidle – Telephone: 020 7680 6550 / Email Sara.Neidle@newgatecomms.com
Jessica Hodson Walker- Telephone: 020 7680 6538/EmailJessica.HodsonWalker@newgatecomms.com
Email: TISA@newgatecomms.com
Notes for Editors
TISA is a unique, consumer focused membership organisation. Our aim is to improve the financial wellbeing of UK consumers by aligning the interests of people, the financial services industry and the UK economy. We achieve this by delivering innovative, evidence based proposals to government, policy makers and regulators.
TISA’s growing membership comprises 170 firms involved in the supply and distribution of savings and investment products and services. These members represent all sectors of the financial services industry, including asset managers, insurance companies, fund managers, distributors, building societies, investment managers, third party administrators, FinTech, consultants and advisers, software providers, financial advisers, pension providers, banks and stockbrokers.
Current themes of TISA policy work include:
• Brexit: developing proposals for government that will enable the savings and investments sector to prosper on a global scale
• Digitalisation: a digital identity for consumers of financial services, innovation, standards and data responsibilities
• ISA’s: LISA, simplification of the regime
• Retirement saving: the Auto Enrolment review, self-employed and pension tax relief
• Housing: the use of property to supplement retirement income
• Guidance: developing a framework and services to make guidance more widely available
• Education: supporting the education of young people to make them aware of the impact of finance on their life.
TISA also provides support on a range of operational and technical issues targeted at improving infrastructure and processes, standards of good practice and the interpretation and implementation of new rules and regulations. TISA has a successful track record in working cooperatively with government, regulators, HMT, DWP and HMRC to improve industry effectiveness by reducing cost and risk and to enhance customer outcomes. This work currently includes: MiFID II, CASS, the UK Fund Trading & Settlement initiative and Payments Strategy Forum. TISA Exchange (TeX) is providing a model for transfers and re-registrations.