As the UK begins to transition into the next phase of the pandemic we now need to look collectively at what can help women build their financial resilience
While some people were lucky and able to save throughout the pandemic, for many of us it exposed our financial weakness and with furlough ending at the end of this month (September), as an industry, we need to do more to help our customers connect with their savings, investments and pensions.
Furthermore the FCA has been working with the financial industry on the growing number of vulnerable customers we need to help.
The FCA definition of a vulnerable customer is ‘someone who, due to their personal circumstances, is especially susceptible to detriment, particularly when a firm is not acting with appropriate levels of care’.
One area where we are seeing huge issues is lost or dormant assets.
Many people - both male and female - have lost track of savings, pensions, bank accounts and all types of financial products. We estimate more than 19m people in the UK have become disconnected from financial services products.
That is one big number and, with a collective value of over £50bn that remains unclaimed, we need to start thinking big to solve this problem. Pensions are one of the biggest problem areas.
Many of us have different pension pots linked to each company we’ve worked for.
Industry data suggests there are currently 52m adults in the UK who have 130m pensions supplied by more than 40,000 private, public and state pension schemes.
The identification of disconnected pension pots among such a huge number of schemes is some task and one that is occupying the pensions dashboard.
The pensions dashboard scheme was first announced in the 2016 Budget and was set up to be a ground-breaking online service where we could all see our pensions in one place; it was due to be introduced by 2019.
However earlier this year it was announced this had been pushed back to 2023 and even then, is unlikely to be fully operational from day one, with the main stumbling block being the lack of data needed to populate the dashboard.
The idea of dashboards is not new but if the pensions dashboard is anything to go by, they are complex to put together. But get it right and financial dashboards are a very neat solution.
They have the potential to bring huge benefits for people by bringing together all the savings, pensions and investments in one place. A dashboard would not only help people keep track of their money, but also put it to better use once they have found it.
What is needed is industry and technology to come together to break down the barriers mentioned above. I believe we can help the millions who need it, now.
