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Published by: Mintel International Group Ltd.
Published: Aug. 1, 2007 - 99 Pages
Table of Contents
- Issues in the Market
- Key issues
- Abbreviations
- Insights and Opportunities
- Tap into the non-savers
- Comfort through knowledge
- The adviser interface
- Market in Brief
- The market itself is vast and varied
- Challenges for providers of retirement savings and investment vehicles
- Opportunities exist
- Fast Forward Trends
- The CornerShop Bank
- Definition
- Context
- What next?
- The Over-Optioned
- Definition
- Context
- What next?
- The Nomadic Explorer
- Definition
- Context
- What next?
- Broader Market Environment
- Key points
- Living longer and the retiring Baby Boomers
- Figure 1: Life-expectancy at age 60, by gender, 1981-2051
- Figure 2: Population growth projections, by age, 2004-29
- The change in asset holdings
- Figure 3: Holdings, by asset class, 1996-2006
- Undersaving and Replacement Rate
- Figure 4: Suggested retirement income as a percentage of working income, 2006
- Stock market continues to be healthy
- Figure 5: FTSE 100 Index preformance, 1985-2005
- Personal disposable income trends upwards
- Figure 6: Personal disposable income forecast, 1989-2011
- Lending rate leads decisions
- Figure 7: Bank of England base rate, 1977-2006
- Investor illiteracy, apathy and mistrust
- Ignorance is bliss?
- Understanding savings, investment and retirement needs
- Figure 8: The compounding effects of investment growth, 2007-36
- Scope for online learning
- The struggle to create a healthy retirement income
- Figure 9: Pension savings converted to annuity income, 2007-36
- Signs of greater awareness
- Figure 10: Awareness of the subject of personal finance, 2007
- Economic backdrop
- Internal Market Environment
- Key points
- Psychological barriers
- 2012 - a pensions revolution
- Threats and opportunities for providers
- Over a third of those in work eligible for the NPSS
- Figure 11: Breakdown of those eligible for enrolment in the NPSS, 2006
- Pensions options for consumers
- The state pension
- State second pension (S2P)
- Occupational or company pension
- Personal pension
- Stakeholder pension
- Group personal pension (GPP)
- Additional voluntary contributions (AVC)
- Freestanding additional voluntary contributions(FSAVCs)
- Self-Invested Personal Pension (SIPP)
- Tax benefits
- Contribution tax relief
- Returns relief
- Lump sum relief
- ISA tax relief
- Pension reform
- Defined benefits decline
- Competitive Context
- Key points
- Buy-to-let (BTL)
- Figure 12: Growth in the number of outstanding buy-to-let mortgages, 1998-2006
- Figure 13: Growth in the average price of a home in the UK, 1993-2006
- Equity release
- Figure 14: Number of equity release plans in force at year end, 2003-06
- Individual Savings Accounts (ISAs)
- Figure 15: Number and value of ISAs subscribed, 2001/02-2005/06
- Equity and bond investments
- Own business
- Inheritance
- Engaging the consumer
- Strengths and Weaknesses in the Market
- Strengths
- Weaknesses
- Who’s Innovating?
- Key points
- Depolarisation
- Fidelity, Standard Life, Cofunds and their investment supermarkets
- Standard Life looks to build share
- Personal planning tools
- Group SIPPs
- IFAs have new source for leads
- The SIPP fight
- 5 for life
- Trade Perspective
- Technology and intermediaries
- Product opportunities
- Regulation
- Challenges and the future
- Market Size and Forecast
- Key points
- Context
- Collective investments and pensions
- Figure 16: Summary of new business premiums, 2002-07
- Buy-to-let mortgages
- Figure 17: Number and value of buy-to-let mortgages outstanding, 1999-2006
- Figure 18: Number and value of buy-to-let sales, 1999-2006
- Figure 19: Forecast of new buy-to-let mortgages, 2006-11
- Market Share
- Key points
- Pensions
- Figure 20: Top ten pension providers in the UK, 2005
- Figure 21: Top individual pension providers, 2005
- Figure 22: Top other pension providers, 2005
- Halifax leads the way in the ISA market
- Figure 23: Top cash ISA providers, 2007
- Buy-to-let
- Figure 24: Top buy-to-let mortgage providers, 2005 and 2006
- Market make-up
- Companies and Products
- Scottish Widows
- Standard Life
- Aviva
- AXA
- AEGON Scottish Equitable
- Norwich Union
- Legal & General
- Brand Communication and Promotion
- Key points
- Public is wary of financial services advertising
- Figure 25: Interest in financial services advertising, March 2007
- Figure 26: Adspend on pensions, by type and related products, 2002/03-2006/07
- Print remains the preferred media channel for pension promotions
- Figure 27: Pension adspend, by channel, 2006/07
- Figure 28: Annual and cumulative adspend, by pension providers, 2002/03-2006/07
- Re-emphasising ISAs?
- Figure 29: Annual and cumulative adspend, by ISA type, 2002/03-2006/07
- Rebound in BTL adspend
- Figure 30: Adspend on buy-to-let mortgages, 2002/03-2006/07
- Channels to Market
- Key points
- The Independent Financial Adviser (IFA)
- Consolidation in the market
- Three key channels
- Figure 31: Regular-premium individual pension business, 2002-06
- Figure 32: Regular-premium group pension business, 2002-06
- Equity release and buy-to-let
- Figure 33: Distribution channels used by the top ten buy-to-let lenders, 2006
- Consumer Financial Activity
- About the Financial Activity Bulletin
- Expected activity picks up
- Figure 34: Expected financial activity - savings, investment, borrowing and debt repayment, December 2005-March 2007
- Much greater emphasis on saving than spending
- Figure 35: UK savings and spending indices, January 2001-March 2007
- Activity remains subdued across most demographic segments
- Figure 36: Expected financial activity over the next six months, by gender, age, socio-economic group, household income and working status, March 2007
- Placing a cash deposit and saving in an ISA are the top activities
- Figure 37: Top five financial activities planned in the next six months, March 2006-March 2007
- Identifying the main financial services providers
- Figure 38: Saving, investment and lending: market sizes, by expected customer demand and brand leaders, March 2007
- Nationwide tops the activity chart
- Figure 39: Activity levels of main financial services providers’ customer bases, March 2007
- The Consumer - Retirement Saving
- Key points
- Huge gaps in pension ownership still evident
- Figure 40: Pension ownership, March 2007
- Half of population are not contributing to a pension
- Scope for female-friendly options
- Figure 41: Pension ownership, by gender and socio-economic group, March 2007
- Implications and opportunities
- Low ownership among the young…
- Figure 42: Pension ownership, by age, March 2007
- …but the NPSS should change that
- Implications and opportunities
- Figure 43: Pension ownership, by marital status and lifestage, March 2007
- Implications and opportunities
- Cash the key limiting factor
- Figure 44: Main reasons for not contributing to a pension, March 2007
- Affordability and Apathy
- Implications and opportunities
- Affordability still an issue for the better off
- Figure 45: Main reason for not contributing to a pension, by gender and socio-economic group, March 2007
- Implications and opportunities
- The gender divide
- Implications and opportunities
- Apathy and property - the key trends among younger non-savers
- Figure 46: Main reason for not contributing to a pension, by age, March 2007
- Implications and opportunities
- Cohabiting, but without the savings habit
- Figure 47: Main reason for not contributing to a pension, by marital status and lifestage, March 2007
- Implications and opportunities
- Cash-strapped families can’t afford to worry about the future
- Implications and opportunities
- The Consumer - Increasing Savings Activity
- Key points
- Plenty of reasons for saving - so why aren’t they?
- Figure 48: Factors that would encourage consumers to save more for retirement, March 2007
- Security is the primary motivator towards greater saving
- Necessity, not luxury
- Implications and opportunities
- ABs look to an early end to the working life
- Figure 49: Which of these factors would encourage you to save more for retirement, by gender and socio-economic group, March 2007
- Implications and opportunities
- Figure 50: Which of these factors would encourage you to save more for retirement, by age, March 2007
- Promoting the family angle
- Figure 51: Which of these factors would encourage you to save more for retirement, by marital status and lifestage, March 2007
- Implications and opportunities
- Is targeting the non-savers a non-starter?
- Figure 52: Factors that would encourage consumers to save more for retirement, by pension provision, March 2007
- Implications and opportunities
- Taking the easy option
- The case for tax reform
- Figure 53: Attitudes towards pensions and retirement, March 2007
- Negative attitudes towards the industry continue
- Implications and opportunities
- ABs don’t believe the hype
- Figure 54: Attitudes towards pensions and retirement, by gender and socio-economic group, March 2007
- Implications and opportunities
- How to engage younger consumers?
- Figure 55: Attitudes towards pensions and retirement, by age, March 2007
- Implications and opportunities
- Time for a period of consolidation?
- Implications and opportunities
- Contrasting attitudes among the lifestages
- Figure 56: Attitudes towards pensions and retirement, by marital status and lifestage, March 2007
- Figure 57: Attitudes towards pensions, by pension ownership, March 2007
- Implications and opportunities
- The Consumer - Targeting and Marketing Opportunities
- Key points:
- Target Groups
- 1 Uninvolved
- 2 Seeking Alternatives
- 3 Pension Faithful
- 4 Wary and Worried
- Figure 58: Cluster group typologies, by statements on pension provision, March 2007
- Early retirement a key motivation for involved investors
- Figure 59: Target group typologies, by statements on factors that would encourage people to save or invest more money into a pension, March 2007
- Demographic breakdown of the target groups
- Figure 60: Target group typologies, by gender, age, socio-economic group, lifestage, household income, tenure, working status, ACORN categories and commercial TV viewing, March 2007
- Barriers to contributing to a pension
- Figure 61: Main reasons for not currently contributing to a pension, March 2007
- Early retirement a key ambition
- Figure 62: Factors that would encourage people to save or invest more money into a pension, March 2007
AbstractAs the population ages and the government retreats in its support, the pressure to properly plan for retirement increases. This reality brushes against high levels of financial illiteracy and apathy towards actively preparing for retirement. One in two non-retired adults in the UK are not currently regularly contributing to a pension. There are great opportunities for traditional pension provider and alternative retirement products to make inroads into a growing market. However, time is not a luxury.
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