25Oct

The Money and Pensions Service has announced ambitious plans to have five million more ‘pension literate’ individuals in the UK by 2030.

The specific goal of MAPS is “five million more people understanding enough to plan for later life by 2030.”

MAPS chairman Sir Hector Sants unveiled the strategy when he spoke at SG Pensions Enterprise, an organisation that hosts conferences and masterclasses aiming to connect influential decision makers from across the pension sector.

Sir Hector noted that two of the biggest challenges were:

  • How retirement savers can make their pension pots last for the rest of their lifetime
  • How retirees can avoid losing any of their savings to scammers

He also noted that there were a number of challenges that had to be overcome if the final objective of having five million more savvy pension savers was to be met:

  • The population as a whole has limited financial literacy
  • Some consumers do not know where to go to access reliable information
  • Some people distrust the financial services industry
  • The amounts of jargon used by financial services industry figures can cause confusion
  • It can be difficult for people to establish exactly how much retirement income they need
  • Many consumers lack the motivation to properly understand their pension

The MAPS chair noted that the pension dashboard will launch in 2023, allowing retirement savers to see details of all their pension schemes in one place; and that pension providers will be compelled to engage with the dashboard initiative.

He also commented that MAPS was working with the Department for Work and Pensions and others to develop “a mid-life MOT” where an individual’s financial affairs would be assessed when they were 45 years of age.

Finally, Sir Hector spoke of the need “to continue to change people’s attitudes and relationship with money”, adding that “it needs to move from a transactional one often triggered by events such as an imminent retirement to something that is thought about on a regular basis.”