Pension schemes overseas have been held up as models of ways to get people to engage with their pensions.
At the Money Marketing Retirement Summit, an industry panel argued that the UK must try to emulate the successes of the superannuation programme in Australia and the 401(k) system in the US.
MGM Advantage director Craig Fazzini-Jones said: “In Britain, the topic of conversation is how much your property is worth but in the US the conversation round the table is how much your 401(k) is worth. It is a popular subject and therefore people are interested in saving.”
Fazzini-Jones said that the American system’s success is partly down to the fact that the employer is incentivised as well as the saver, so the greater the take-up of 401(k) in the firm, the greater the tax relief that the employer gets.
Burrows & Cummins partner Billy Burrows said the compulsory accumulation system in Australia has bred a new generation of savers.
He said: “Newsnight reported on the superannuation scheme by interviewing an Australian lifeguard. He was there on the beach with his surfboard, saying ’I have got a super and I am really proud of it.’ That is the key – finding a way to get people to engage with their pension and be proud of it – using peer pressure.”
Sun Life Financial of Canada head of marketing Mark Stopard said that people should not be forced to save.
He said: “I would favour something along the lines of the Canadian model where you can get access to something like a pension fund early as a deposit for a house, so there is a really strong incentive to save early.”