The latest round of increases to pension contributions under auto-enrolment has been welcomed by those whose employers have implemented it well, both in terms of the level of contributions and the communication of it.
Most of us do need a nudge to save and when our employer is seen to be looking out for our future too, it just feels better. And feeling better together gets those dopamine levels flying.
As an adviser, it has been great to hear these good news stories. All too often, employers can get it wrong and you just want to close your ears to the mass moaning and groaning.
The battle between the haves and have-nots finds it all too easy to rise to the surface when there is a feeling an employer is doing sufficiently well not to be troubled by, and grumble about, a 3 or 4 per cent contribution. In comparison, employers in Australia are already having to contribute 9.5 per cent, rising to 10 per cent in 2021 and 12 per cent in 2025.
However, while the increases seen here have given a natural opportunity for the masses to pause for thought and reassess their contribution to their own future, this does not last long before they get back to their everyday pressing matters and vices.
One such vice is gambling, which has so many in its grip. It is troubling to see just how prevalent among younger people it is. I co-manage an amateur football team and see a lot of gambling going on. The approval-seeking screenshots and the oh-so-nearly tales on the group WhatsApp no doubt hide anguish and troubles elsewhere.
Such behaviour by players and fans alike is hardly a surprise, given the betting industry’s dominance in football sponsorship.
It is far easier to divert cash into a dopamine-enhancing string of bets in the hope of instant returns than to allocate the money to something sensible like a higher employee pension contribution.
That quick flutter might give a little warmth to the individual but it fuels the flames of even more sponsorship deals. It is one worrying example of short-termism that the long-term insurance and savings industry is up against.
So as boring as it may sound in comparison, positive success stories of nudging money into future wellbeing are satisfying to hear.
Yet there is a clear need for even greater engagement. The dinosaurs that continue to focus on shareholder returns in the first instance have little to brag about outside of the annual general meeting, compared with those great companies that have evolved and can now happily blow their trumpet on handing back profits to their members too.
I suspect, in due course, we will follow Australia’s lead, because both the trial of gradually upping the obligations of employers and the opportunities to have regular reassessments appear to have been a success on the whole.
However, it is also time for the dinosaur insurance and savings providers to evolve, in order to attract more attention from a big, distracted audience.
Mel Kenny is a chartered financial planner at Radcliffe & Newlands