LONDON, June 19, 2017 /PRNewswire/ -- UK Pensions Market 2017
Pre- and post-retirement markets have seen some big changes over the last few years. The state pension has been changed from a two-tier to a flat-rate model to relieve pressure on the government, as the UK population is aging and individuals are living longer. Auto-enrolment will continue to be a big driver of growth in work- and trust-based pensions, as will buyouts as employers look to de-risk. By February 2018, all businesses will have to provide a pension to eligible employees, and by April 2019 the total minimum contribution will be 8%. New pension freedoms have given customers more flexibility in how they take money from their pensions.
Critical success factors
- Technology and robo-advice: Technology must be used to help clients with smaller pension pots access advice. Services will either need to give a recommendation or help individuals decide for themselves. There are generally two areas where technology can help pensions: aiding individuals saving for retirement, or helping those approaching retirement understand their options in terms of accessing their money.
- Encourage pensions savings: The market needs to continue to drive awareness of the need for individuals to save for retirement outside of the state pension. This is especially important to reduce opt-out rates as the minimum contribution increases.
Key pointers include in the report -
- The pensions market has grown by 10.7% to be worth £10.8bn annual premium equivalent (APE) in 2016, and is forecast to reach £17.5bn APE by 2021.
- Work-based and trust-based pensions hold the largest proportion of the pensions market (45.4% and 40.5% respectively); however, individual pensions have seen the highest growth (52.0%) since 2013.
- 1.23 million UK businesses will be required to provide a workplace pension by 2018.
- Income drawdown is now more popular than purchasing an annuity; however, those with pots valued under £30,000 are also opting to make full cash withdrawals.
The report "UK Pensions Market 2017" explores the pre- and post-retirement markets. It discusses recent legislation such as changes to the state pension, auto-enrolment, the Retail Distribution Review, and the new pension freedoms. It explains the impacts of legislation with regards to market sizing, distribution, how people are saving their pensions, and how people are taking their pension pots at retirement. The size of the pensions market has been forecast to 2021. There is also a focus on how technology and robo-advice can encourage pension saving and understanding of pension options.
Companies mentioned in this report: Wealth Wizards, HSBC, NatWest, Santander, Pension Bee, Willis Towers Watson, Aviva.
- This report explores the pre- and post-retirement markets.
- It discusses recent legislation such as changes to the state pension, auto-enrolment, the Retail Distribution Review, and the new pension freedoms.
- It explains the impacts of legislation with regards to market sizing, distribution, how people are saving their pensions, and how people are taking their pension pots at retirement.
- The size of the pensions market has been forecast to 2021.
- There is also a focus on how technology and robo-advice can encourage pension saving and understanding of pension options.
Reasons to buy
- Understand the impacts of recent legislation on consumer behavior in the pre- and post-retirement markets.
- Discover how technology and robo-advice can be used to encourage individuals to save pensions and give advice at retirement, ultimately increasing customer engagement.
- See how the UK pensions market is forecast to grow over the next five years.
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