Consultation on Pensions Tax Relief

Transcription

1 Giles Lenton Head of Insight, The Wisdom Council TSIP Pensions Tax Relief Quantitative and Qualitative Study Key highlights Giles Lenton September

2 The Wisdom Council Our goal To help rebuild trust in Financial Services How Working closely with firms to: Build better connections with their customers Deepen understanding Give their customers a strong voice We work with firms who want to engage actively and positively with their customers TWC support Quantitative To give a robust, statistically viable basis to the research Sent to over 1,000 consumers from all segments of the UK Saving & Investing population Total sample of 290 Sample aged 18 to 75 all pre retired Qualitative To add deeper colour and further insights to the output from the quantitative work 2 x focus groups 1 xolder group mix of income, age and background 1 x young professionals all financially sophisticated and higher rate tax payers now or near future 2

3 Knowledge 90% of people say they know enough about pensions to get by Some bits I understand, other bits I know absolutely nothing Focus Group Participant: Female c55 about! The rules keep changing so its always difficult to be sure Focus Group Participant: Male c60 My pension and I Retirement is a remote construct for working people. It is normally seen and talked about as being a long way off until suddenly it is just round the corner! 47% do not have a view about when they will retire 3

4 Ownership The further you are away from pension age the more remote it is Its not really mine until I start drawing it Focus Group Participant: Male c30 Even the ownership is nebulous. I just don t see it as wholly mine my company owns it as Focus Group Participant: Female c45 much as me Pension Planning? 41% believe they know the size of the pension pot they need Only 18% believe they have planned their pension etc. to achieve this 53% do not know how much they should be putting into a pension to achieve this 4

5 Communication Engage Inform Motivate So much of the communication from pension companies is just incomprehensible twaddle Focus Group Participant: Male c55 Policy Proposals Level of incentives Simple Tangible Contributory Stable It s the nature of the communication as well as what is being communicated 2 for 1 vs. % Contribution vs. Tax relief The more Government and employers contribute, the more motivated employees are to contribute 5

6 Policy Proposals When to tax Emotionally driven choice = Now vs. Rationally driven choice = Later 68% prefer to pay tax now and take it tax free later Flexibility & access 38% thought first time buyers should be able to access it for a deposit (with limits and guarantees) 66% believe it s important to limit access until 55+ Some want freedom all want discipline!! 6

7 In summary Changing the rules on something people do not understand and are not motivated to understand is not a solution on its own. But making pensions simpler and easier does increase their appeal Communicate to motivate Contacts Giles Lenton Head of customer insight giles.lenton@thewisdomcouncil.com Alison Malton Chief Operating Officer alison.malton@thewisdomcouncil.com Sean Ingram Managing Director sean.ingram@thewisdomcouncil.com 7

8 This document has been prepared for general guidance on matters of interest only in accordance with our standard terms of business or contract with you. No representation or warranty (express or implied) is given as to the accuracy or completeness of the information contained in this document. Any engagement between The Wisdom Council and any organisation referred to within this document is subject to contract. The Wisdom Council All rights reserved. The Wisdom Council is the trading name of Wisdom Global Limited, registered in the UK company number and whose registered office is at 8 Laurence Pountney Hill, London EC4R 0BE. 8