Why is the pension user journey so rough?

People worry about their pensions, they do not enjoy the prospect of having a later life free of work, they worry that they haven’t saved enough, they’ve lost their pension rights , they worry about their money running out before they do, they have no game plan for meeting the costs of care and they hate the prospect of getting ripped off by intermediaries.

I speak here , nor from the inside of the pensions bubble, where I know we believe we are delivering value for money (have you ever heard any institution admit the contrary?).

I speak from the perspective of Paul or Martin Lewis whose interactions with the public tell them that people do not feel in control of their retirement affairs and look forward to their “user journey” with dread.

Five things that people hate about pensions

  1. Projections; people don’t understand the difference between a pension projection and what they get from their pension. The two don’t match and most people feel they’ve been lied to at the point of sale.
  2. Tracing; people hate the thought that they have retirement savings they have forgotten about or never knew existed. They can’t understand how people can hold their money without them knowing about it.
  3. Access; whether it’s to combine pots, spend them or to set up an income from them, people do not know how to go about it and find the process fraught (unless they pay someone to do it for them)
  4. Attitude; it’s not just the language, it’s the attitude we have to the public who we assume will get scammed or financially self-harm. People do not think that pension companies are on their side.
  5. Rules; we seem to have a rule for everything. There are rules about what you can put in , what you can take out and rules about what people can tell you (without you paying for advice). Most of the literature people get sent is not about them but about the rules.

We are not on the customer’s side

I chaired a conference session on pensions administration on Thursday. On the one side of the panel was an industry veteran who was COO of a million member master trust. On the other side was the COO of pensions one genuine success story of the last five years. In the middle was an admin expert. I wanted to find out what would bring admin costs down.

I came away from the session thinking that administration and customer support should be the same thing. We should not think of an administrator as a clerk but as the person who delights the customer with the good news that they can make things happen the way the customers want them to happen.

When I first got involved in helping those who had been scammed out of their pensions, the thing that became clear was that they trusted their scammers more than the people who were managing their money for their good. The difference was all about the user journey that they were taking in getting back their money.

But we have turned this around so that we now believe that making it easy to combine pots , withdraw your money or take an income is assisting the scammer, it may even be a sign of scamming. We are now considering making a meeting with Pension Wise a compulsory part of the user journey and we are still three years away from the dashboard availability point (my estimate).

Making things better

The cost of pension administration is grossly inflated by the preventative measures we put in place to make sure that people don’t fall foul of the rules or scammers. We have too many rules and not enough access to our cash. We must work harder to give people access to their money and helping people understand the rules as a way of helping them. Most of the rules are there to help but that’s not the way most people see them.

We need to be more service orientated, I do not feel that the majority of call centers I speak to are looking to delight me or the person I’m working for, we need a change of attitude and that comes from the top down. We need to train our support staff to want to do more – witness First Direct and Pension Bee who do just that. It’s an attitude thing

We need a nationwide pension finding service that can be launched as soon as possible. I am beginning to think that we might launch this before we launch a pension dashboard as a standalone service. Next week I will be talking with Punter Southall about National Pension Tracing Day on 31st October which I hope to advertise. We can do more to help people find their pensions.

Finally, we need to be able to explain to people why their expectations of their pensions should be based on hard reality and not on pension projections. We now have the capacity to give people online access to most pot values and we need to be able to talk people through the “what needs to happen.

Right now , most people consider their pension journey as one they don’t look forward to. This is a shame as the money locked up in their pensions is money that can buy them things in retirement they should look forward to. They have done the hard work of saving and we have done the easy work of investing! We now need to help them to understand that their saving has been worthwhile.

We should be able to do this with a smile on our faces. It should be our pleasure to make them smile as they see an easier way forward.


About henry tapper

Founder of the Pension PlayPen,, partner of Stella, father of Olly . I am the Pension Plowman
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4 Responses to Why is the pension user journey so rough?

  1. John Mather says:

    For decades the pontificating class has demonised the adviser with cheap shots about commission providing the public the excuse to procrastinate into beyond work poverty

    It is no coincidence that 6% take advice and 6% plus public pension beneficiaries are well taken care of

  2. Robin Rowles says:

    Back when I was young, for the most part executive salaries and shareholder returns were at a moderate level. And, here’s a strange idea, pensions were based on earnings and were easy to calculate. Then all of a sudden someone said “Here’s a good idea. Let’s let the employees take responsibility for their pensions based on their contributions. They’ll have control and a large pot of money to retire on, or to take when they want to.” And guess what. The change was made, employees didn’t have a clue whether they could afford to retire, nor when, and company profits rose, shareholder returns went up and executive salaries skyrocketed. (I was there at the time and saw it happen in my company). And now the average employee is in a mess, even though some have access to a small pension they never had before, whilst shareholders and execs are laughing all the way to the bank and a rich retirement. There is an easy answer. Admit DC is a disaster and return to DB, funded by execs salary increases since DC was introduced, perhaps. Oh, and please, please, please, scrap Pensions Freedoms!

    • John Mather says:

      Robin, I think you will find, judging by he number of failed schemes in the PPF, that DB has failed everyone except those in the the public which are funded by the tax payer. The projections were just wrong and the DB alchemy mis sold.

      If we had a decent State Pension much of this would be a none event

  3. John Eckersley says:

    The biggest challenge as an “ordinary punter” for me over the 40+ years of working has been the sheer volume of rule changes – I remember thinking in my 20s that I should pay attention to my future in relation to a pension in addition to whatever the State offered (no winter fuel payments or triple lock for pensioners then) – but the rules have changed so much. At that time employers could force you to join and contribute to the company scheme. Then that was abolished – now we’ve (sort of) come full circle. There’s just too much short-termism to expect people to make a decent plan.

    I have TUC (remember them) book called “planning your pension” I paid £9.99 for in 2002. Almost everything in it is out of date and no longer applies – in only 20 years.

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