Copy article

FCA report on pensions engagement

ended 18. September 2024

Last week, the FCA encouraged financial advice firms to explore new approaches to increase pension engagement. Its research found that it’s difficult to drive pension engagement through emails and that firms should try innovative approaches to encourage customer engagement. Against this backdrop, a handful of questions:

  • Is email becoming less relevant in the age of social media? 
  • Have you got any examples of (unusual/off-the-wall) activities that have boosted pension engagement?
  • Does video content boost engagement with prospective clients more than text and emails?
  • Does your firm have a presence on TikTok, Instagram and other social media channels used by a younger demographic? If so, how successful have you been on them?

4 responses from the Newspage community

Copy all

Copy

Editor
Ross Lacey
Director & Independent Financial Adviser at Fairview Financial Management
We see pension engagement being driven by showing clients what their pensions actually mean and translate into when it comes to retirement. Telling someone they have £X in their pension pot, or will have £Y at age 65 without any context can leave people completely in the dark around what this means for them. Everybody has a different lifestyle requirement in terms of how much they need/want to spend. They'll also have different resources to fund this, which includes their pension. Showing somebody, with context, what their pension pot is currently likely to mean for them, along with variations based on different factors, can help them work out if they already have enough to do what they want to do, or if there's a shortfall to deal with while they have the chance.
Copy

Editor
Gabriel McKeown
Head of Macroeconomics at Sad Rabbit - Substack Newsletter
While TikTok dances may capture more attention from the younger generation than a conference on retirement planning, there’s a thin line between being innovative and being laughable. The regulator's recent call for firms to explore novel approaches to increase pension engagement should not be a surprise to many in the industry, with traditional email campaigns falling flat. However, reliance upon social media risks trivialising important financial decision-making by reducing it to 15-second videos and the latest vacuous trends. Furthermore, there are real concerns about the potential for misinformation and oversimplification of complex financial concepts. The fast-paced nature of social content doesn't allow for the nuanced discussions that pension planning requires. Therefore, the future of pension engagement requires a delicate balance between innovation and tradition.
Copy

Joshua Gerstler
Chartered Financial Planner at The Orchard Practice
In an ideal world, families will start engaging with their pensions at school. As soon as they are old enough to understand, they should be taught what pensions are and how they work and how amazing they are for your retirement. We often engage with the children of families we look after, at age 18, to get them to start thinking about financial planning. The sooner you do the this, the easier it is. What an advantage you can have in life if you start your financial planning 10, 20, 30 or even 40 years earlier than everyone else.
Copy

Alastair Hoyne
CEO, Finanze Capital at Finanze Capital
Pensions can be quite boring and by the time you rersearch them it's often too late. It would have been great if you had started 30 years ago. Rather than TikTok videos and social media, better financial education in schools and the community would work wonders to improve the financial literacy and health of the nation. Yes emails are less relevant in terms of online communication now that social media dominates but an email written to a person by another person is a powerful thing and still holds some authority even with the younger generation. It’s the effort and meaning placed into a message that gives it weight rather than its accessibility, platform and overall design. The FCA is increasing the regulatory burden upon advisers in the UK. The administrative workload and cost burden means focusing on attracting clients with sizeable assets to ensure profitability. Reaching a younger demographic via TikTok is therefore close to the bottom of the priority list for most advisers.