Planning for the long term - is it the era of dashboards?

The last 2 years have been the most challenging for a generation. No-one foresaw the impact that Covid-19 would have on us all. New words such as ‘lockdown’, ‘self-isolation’ and ‘furlough’ have entered the lexicon, and as we enter the next phase of living with Covid, looking back, it’s astonishing how much our world has changed.  

I’m a big fan of creating a time machine to help members look at their future self with and without a decent income in retirement. If I had a time machine at the beginning of 2020, that would have been very helpful! 

The world of pensions is always one of change, however over the last 24 months we have seen challenges like never before;  not only do the usual challenges for pension schemes remain, but we’ve also had to adapt to new ways of working, deal with the shock of the pandemic, the enormous pressure on workloads and supporting trustees and sponsors with their ongoing projects such as de-risking and moving to master trusts.

At the same time, we’ve also had a restructure of our business. We’ve not always got everything right, but I’m proud that during these turbulent times we’ve ensured that our 2 million pensioners got paid and we were there for members and clients when they needed us most.

The need to look forward

We now need to look forward, and one of the things I’m really passionate about is improving member outcomes, regardless of age, gender, race, or religion. Planning for income in retirement has always been a challenge. That’s no surprise when you consider the time horizon that it covers. If the last few years have taught us anything, it’s that thinking and planning for the long term is exceptionally hard in an unpredictable world. No wonder then that for most people, pensions is an enigma that is yet to be solved.

When I consider what will happen in the future, from both the pensions industry and Capita Pension Solutions perspective, I am excited about how we can create better outcomes. I am also a realist and know that there are many challenges ahead but am confident that together we will deliver.

The need to personalise and make it wider than pensions

Reflecting on how we operate as an industry, too often we are guilty of generalising long-term savings and talking at a macro level in an unconnected way. What we need to do is take a step back and understand the micro issues for an individual, and really listen to the voice of the member, not just pay lip service to it. This is easier said than done, but without this we risk becoming irrelevant and worse still, failing to grasp the responsibility we have as custodians of people’s futures. 

In order to achieve fair outcomes we have to recognise the differing needs of everyone, only then will gaps across different cohorts, be that age, gender, ethnicity, or income be eliminated. Access to a good outcome should not be the preserve of a few, it should be for everyone. The one size fits all messaging we are used to seeing with pensions and utopia of relaxing on the beach just does not resonate any more, nor is it relevant.   

Pensions is just one part of the jigsaw, there are other financial issues and wellbeing to consider, so we have to strive for a better way of bringing everything together, something I’m passionate about doing.

We need better joined up thinking - for example, how often do we talk about pensions, long term care, wealth, and health in the same conversation? Arguably we’re getting better at this but there is a long way to go. 

A colleague of mine recently helped his mother access her pension with a provider and came across barrier after barrier. Even simple things like setting up a security question to online access became a challenge as his mother grew up in India and none of the questions resonated. She could not remember the name of her first school – it’s simple things like this we should consider, is that a reasonable question to ask a 73-year-old?

Is future life dashboard the answer?

It’s great that initiatives like Pensions Dashboard are well on the path to becoming reality, but this in no way should be seen as the end – it’s just the beginning. For me, it’s another ingredient in the recipe to create a ‘future life dashboard’

We should challenge ourselves to create a holistic view of today and the future, and one that not only provides information, but allows you to transact.

I envisage a personalised portal that includes everything from income, savings, debt, health and mental wellbeing tools and long-term care planning, along with guidance and the ability to instantly get a picture of what an individual’s current and future life will look like.  

All of the key metrics would be available, creating a better planning tool and increasing repeated and timely engagement, bringing the right information to the fore based on where an individual is in their life.  Whilst some elements of this already exist, they do not really cover everything and do not address the micro issues that are personal to an individual.

 A future life dashboard must be personalised to recognise that lots of factors influence our current and future life. These can be cultural, such as the expectation that parents are supported by children, as well as the usual influences on life.  

Is it feasible or just wishful thinking?

Creating a future life dashboard will be difficult, but it’s not just wishful thinking. As I said above, we have already started creating the building blocks, but for me the key reasons why it can now become a reality are the advances in technology, underpinned by data.

Digitisation brings about a number of benefits, and with it exciting and new opportunities. Pensions has been the laggard of the digital world, but now we need to come together as an industry to learn from, and work with, other sectors to become leaders in this field.

Data is at the heart of everything that we need to deliver and having the right data has never been more important. Data underpins everything, from using it in the dashboard and pensions Apps, to helping with reconciliation and remediation projects, or simply to ensure strong governance. Without good data, everything will fail. 

Recognising this, we’ve created one of the largest data teams in the industry to create solutions which get our clients ‘data ready’ for whatever project it is needed in, whether that’s for today’s projects or the future life dashboard! 

Exciting times

As I look forward, I believe we are entering an exciting era. This will require new thinking, new ways of working, strong accurate data, and investment in technology; and this is exactly what we’re doing.  Whilst my time machine might be a little out of reach, we must all work together to ensure we meet the ultimate objective – creating better outcomes, and the future life dashboard will surely help with that.