Industry experts have highlighted the role money apps could play in driving stronger pension engagement, after research from Moneyhub found that a quarter (25 per cent) of savers have never checked their pension, while a further 23 per cent only check once a year.
The research reflected on the historical lack of engagement that savers have had with their pensions, with many only being alerted about their pensions’ value once a year in the provider’s annual statement.
According to the research, this inertia around pensions is, “concerningly, more prominent in the over 55s, with 40 per cent saying they never check the value of their pension and a further 20 per cent only checking the value once a year.
In contrast, the research found that younger savers are becoming more engaged with their pension, checking more regularly, likely due to the ease of doing so through the pension provider’s app.
Indeed, the research found that nearly half (48 per cent) of 16–24-year-olds and 47 per cent of 25–34-year-olds said they check their workplace pension at least once a month.
In light of the findings, Money Hub emphasised the role that technology can play in encouraging engagement with pensions, suggesting that the upcoming pensions dashboards could be a “key solution” to solving the lack of engagement and savings shortfall in the UK.
The benefit to savers will depend on the type of dashboard though, with the government dashboard expected to enable savers to find and view all their pensions including their state, workplace and personal pensions.
Commercial pensions dashboards are expected to go a step further, however, not only finding the same pensions, but also letting savers connect to other financial products they use, with Moneyhub stressing the need for savers to consider their finances holistically.
Commenting on the findings, Moneyhub marketing director for personal finance technology, Mark Horwood- James, stated: “There is evidently a clear need, and a want, from consumers to gain a better understanding of their pensions and more regularly check in with their expected retirement income. Only by staying engaged can you course-correct early enough to make a difference in your later years.
“However, it’s not simply enough to engage more with your pensions, we must look at our finances holistically. Open Finance powered solutions enable customers to better understand all their finances, create lasting savings habits, help switch to better products and find some of their lost pensions.
“In turn this ensures they have the capacity to save more into their pensions, and make better decisions when it comes to later-life savings. Pensions dashboards when combined with holistic money management tools are a true game changer for the industry and its customers, and at Moneyhub we’re ready to help both today.”
This comes after the news that Standard Life had partnered with Moneyhub on plans to deliver a commercial pensions dashboard, embedding its white label pensions dashboard into its existing customer app.
