Research into women’s attitudes to pensions by The Fawcett Society (Fawcett) earlier this year revealed that, even when women earn the same as men, they save less. This means that well known barriers such as low pay are only a part of the picture. So why are women still behind their male counterparts when it comes to being in charge of their financial present and future?
Women are on average putting around 40% less into their pension pots than men. There are a number of key factors at play here. Some are outside the scope of the pensions industry to directly influence, others are within reach.
Both men and women are underestimating how long they will live and how much they will need and have in retirement.
For women, one of the strongest themes highlighted by Fawcett was the lack of understanding of pensions which led to low confidence in decision making and a tendency to shut down on the topic.
The research revealed this lack of confidence is undermining women’s financial independence and decision-making. This was compounded by the perception of a ‘masculine’ financial environment and a lack of awareness of the financial consequences for themselves of the impact of unequal caring responsibilities and the savings decisions they are making.
To address such information gaps, a key recommendations for the pension industry was to provide clearer advice and information. It was suggested this could be done by visualising the benefits of increased contributions. In essence, offering access to pension information with a similar ease to that offered by online banking.
Achieving widespread engagement with pension saving remains one of the industry’s biggest challenges. In July 2015 Equiniti released v1.0 of its RetireMe app and it blazed a trail as the UK’s first tool to be developed to enable everyone to understand and manage their drawdown options. The standalone app was made available for download for anyone for free (view the video here). Traction was impressive:
- 90% strongly agreed that RetireMe helped them make the most of the new flexible retirement rules;
- 82% strongly agreed it helped them understand when they can retire;
- Average user score of 8.2/10 when asked ‘to what extent has RetireMe encouraged you to increase your contribution levels and/or make changes to your pension’.
This was just the start of Equiniti’s mission to improve pension saving engagement and in March 2016 we released v2.0. The main enhancements were driven by user feedback and retained the focus on a customer-grade experience. Continued engagement with any app, pension or otherwise, is fragile and needs great customer feedback. Failure to sustain this results in a rapid user drop off.
RetireMe 2.0 has seen a 180% rise in the number of downloads and a 135% increase in the number of sessions, demonstrating the app’s ability to strengthen user engagement.
With regards to female engagement, RetireMe 1.0 was in line with industry trends. Statistics from v1.0 revealed that 86% of users were male. We saw this as an opportunity (and need) to engage more women.
RetireMe v2.0 has doubled the female user base from 14% of total users to 28% year on year (October 2015 to October 2016). Significantly, this trend looks set to continue with a near 6% increase in the last two and a half months alone.
Putting the fun into finance
In March this year, Baroness Altmann, the then pension minister, talked to the Commons Work and Pensions Committee about the need to be more ‘fun’ with apps and games.
Mobile usage patterns back the Baroness up – over 70% of internet access is now from a mobile device and well over 80% of mobile usage directly attributable to app usage. Mobile usage is about customers engaging when, where and how they want to engage. Smartphones are today’s constant companion.
Women need more information on pensions that is easy to access and understand. The need has never been greater to focus on female engagement with lifetime savings.
*Dave Erhard, Retirement Coach.