Pensions and silent films - moving with the times
There are no words to describe the winner of Best Film Oscar in 2011, The Artist. The movie silent screen idol, George Valentin, is enjoying the success of his latest picture when Peppy Miller an aspiring young actress literally and figuratively runs into Valentin at a film premiere, which launches her acting career. Talking movies are taking off and the film tracts the reversal of their fortunes. Peppy tries to help Valentin but ultimately he has to decide whether he moves with the times.
There is a movement happening in the pensions landscape that is seeing the move from defined benefit to defined contribution schemes. Over the last 10 years, we have seen employers change the workplace pension provision from a defined benefit to a defined contribution scheme, initially for new employees and then to existing employees. The changes to the State pension is moving to a single payment, where the full pension will be above the basic means-test.
The pensions landscape is moving into “talking films”. A landscape that requires the individual to take responsibility for their own retirement income. It moves away from the “silent film” world where you reached retirement and you were the recipient of a “gold watch” and a pension.
Changing the rules is the easy bit. The big need is to change the culture. People need to move from being recipients of pensions to consumer of pensions and long term savings. How are we going to go about doing this? We believe that a vital ingredient is the provision of independent and impartial expert guidance. The objective of the guidance is to:
- give people the confidence to engage with the long term savings market;
- provide a foundation layer of protection for people by increasing their knowledge about the questions that they should be asking themselves and others and
- help people map out the next steps that they need to take.
It is critical for public policy for the whole of the industry to work together to turn people from recipients of “silent movie” savings products to active consumers of the “talking movies” of pensions and long term savings, so that they can take responsibility of their financial future.
If you've got a question about your pension or are seeking guidance on your pension, you can contact our team who'll be happy to help.