HELP STAFF TO BETTER MANAGE THEIR MONEY USING NEW FINTECH APPS AND PLATFORMS. 22 November 2018

Transcription

1 HELP STAFF TO BETTER MANAGE THEIR MONEY USING NEW FINTECH APPS AND PLATFORMS 22 November 2018

2 ON THE MENU FOR TODAY What am I talking about? Money Management: Why Help? Tech innovation: wider finances Can it work?

3 MONEY MANAGEMENT WHY HELP?

4 IT S BLEAK RESILIENCE Stretched pay packets In the last 10 years inflation has outstripped wage growth more than half of the time Average consumer debt per household is 7,874 37% of people have less than 1,000 in cash savings (FCA Financial lives) FINANCIAL WELLBEING One in four employees say that financial concerns have affected their ability to do their job (CIPD). PENSION Auto-enrolment puts the average earner on track for an income of half their pay at 68. But 60% of that is State Pension. Fewer than 3 out of 10 people believe their pension is invested in the stockmarket CASH 1 in 14 current accounts have been switched since 2013 (FCA) 10% of people say they last switched savings account five years ago or more, and 40% have never switched (HL)

5 PEOPLE KNOW MORE THAN THEY THINK THEY KNOW Knowledge Wobble 68% 66% 64% Actual knowledge 62% 60% 58% 56% 54% Perceived knowledge 52% 50% Young professionals Peak savers Approaching retirement Retiring Retired Source: HL & Censuswide research, July ,016 respondents

6 APPETITE TO SPEND TIME ON FINANCES Amount of time prepared to be committed to dealing with finances: non-retired 35% 30% 25% 29% 20% 23% 15% 19% 16% 10% 5% 0% 1% 1% None I am not willing to spend any time None someone else does it for me 2% Less often 8% A day once or twice a year A few days every few months A few days a month A few days a week Some time each day Source: HL & Censuswide research, July ,016 respondents

7 ISAs ARE COMMONPLACE FCA Financial Lives Data 46% have an ISA 29% of which are stocks & shares ISAs LISAs are growing in popularity

8 TECH INNOVATION WIDER FINANCES

9 What INTERNET am ACCESS I talking about? in 10 had internet access, now 9 in % accessed internet daily, now 86% accessed daily Devices used to access the internet in the last 3 months 100% 90% 80% 70% 60% 50% 40% 30% 20% 10% 0% Mobile phone or smartphone Desktop computer Source: ONS Internet access households and individuals, Great Britain: 2018

10 What TECHNOLOGY am I talking FOR PERSONAL about? FINANCES Phase 1 rise of the platforms Source: Platforum, February 2018

11 What TECHNOLOGY am I talking FOR PERSONAL about? FINANCES Phase 2 open banking a whimper not a bang Open banking introduced 13th January 2018 for CMA 9 75 open banking license granted (as at 6th November) only 22 are banks / building societies Sources: Open Banking & OpenWrks August 2018

12 What TECHNOLOGY am I talking FOR PERSONAL about? FINANCES Phase 3 pension dashboard Feasibility study due any day now Budget key clues: Pension dashboards (plural) State pension enabled Phase 4 open wealth The future?

13 ROBO ADVICE Will this become a thing?

14 CAN IT WORK? WHAT WE VE FOUND

15 THREE TYPES OF EMPLOYEES IN A WORKFORCE Engaging with money Won t engage Engageable Engaging

16 HOW TECH IS DRIVING ENGAGEMENT Analysing choices from 60,000 members who ve not chosen HL ENGAGEMENT Contributions Investment Choice Pension Transfer In Additional Account Online Access Log In Last 12 Months Death Benefit Paying more than the minimum Made an investment outside of the default Transferred in another pension Saving into an additional account with HL Registered to view account online Logged in to view account last 12 months Set up a nominated beneficiary 50% paying more than the minimum 22% making own decisions 23% transferred in another pension 12% with additional account 59% have online access 77% with online access logged in 20% have nominated beneficiary Source: HL Research, April 2018

17 ENGAGEMENT WILL GET EASIER Pension Pot Size The Pension Boredom Threshold 100% 90% 80% 70% 60% 50% 40% 30% 20% 10% 0% Less than 5, , to 10, , to 25, , to 50, , to 100, , to 250, More than 250, Not engaged Slightly engaged Well engaged Super engaged Source: HL Research, April 2018

18 THE VALUE OF ONLINE ACCESS The impact of online access on member engagement 60% 50% 40% 30% 20% 10% 0% Contributions Investment Choice Transfer In Additional Account Death benefit nomination Not Online Online Source: HL Research, April 2018

19 What GREATER am INTERACTION I talking about? 56% of log-ins now occur via mobile app Weekday Visits by Hour of Day 10.0% 9.0% 8.0% 7.0% 6.0% 5.0% 4.0% 3.0% 2.0% 1.0% 0.0% 12:00 1:00 2:00 3:00 4:00 5:00 6:00 7:00 8:00 9:00 10:00 11:0012:00 PM 1:00 PM 2:00 PM 3:00 PM 4:00 PM 5:00 PM 6:00 PM 7:00 PM 8:00 PM 9:00 PM 10:0011:00 PM PM Mobile App Desktop Website Source: HL Visits 2018

20 THE VALUE OF FACE TO FACE MEETINGS The twist in the tale 90% 80% 70% 60% 50% 40% 30% 20% 10% 0% Increased contributions Chosen investments Transferred a pension Saving alongside the pension Online access Logged in (last 12 months) Death nomination No meeting Face to face meeting Source: HL Research, April 2018