We examine whether targeted support communications influence how consumers make decisions relating to their pensions.
Many people are missing out on advice and support that could help them better manage their finances. As part of the Advice Guidance Boundary Review, the FCA is proposing a new approach called targeted support to help narrow the gap between advice and guidance. This allows authorised firms to use limited information to offer appropriate suggestions to consumers who share similar high-level characteristics.
To test how consumers respond to targeted support communications for pensions, we conducted behavioural research with consumers. This research explores how consumers respond to communications about targeted support in the context of two pensions decisions:
- Deciding whether to increase contributions to a pension (Contribution experiment), and
- Deciding how to access a pension (Decumulation experiment).
Specifically, we examined whether additional information – like details about the targeted support suggestion (also referred to as a ‘ready-made suggestion’) and how it was generated – can improve:
- Understanding of targeted support.
- Uptake of the targeted support suggestion.
- Confidence in decision-making.
- Sentiment towards the targeted support suggestion.
This Research Note investigates targeted support communications for pensions. We also investigated targeted support communications for retail investments. These experiments were independently designed with results reported separately. Further interpretation of the policy implications of this research, taken together with the research on retail investments, are included in the Annex (8) to CP25/17, ‘Lessons from behavioural testing for targeted support’.
Authors
Rhosyn Almond, Lucy Hayes, Isaac Keeley, Mia Mayixuan Li, Bridie Meakin, Emily Morris, Krishane Patel, Manasi Phadnis
Disclaimer
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