Symposium: Financial Resilience throughout Life Breakout session Wednesday 20th of April 2016 Beurs van Berlage - Amsterdam

1. BREAKOUT SESSION
Good practices in encouraging
retirement planning across
the population
20 April 2016

2. |
Good practices in encouraging retirement
planning across the population
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Moderator
Olaf Simonse
Head of Money Wise Platform, The Netherlands
Will Sandbrook
Executive Director of Strategy at NEST,
United Kingdom
Carlos Ramírez Fuentes
Chairman of the National Commission for
the Pensions System in Mexico
Miles Larbey
Senior Executive Leader, Financial Literacy,
at the Australian Securities and Investments
Commission (ASIC)
Anne Seiersen
Executive Director Danish
Insurance Association
Femke Kruiderink
Supervision Officer at Netherlands
Authority of Financial Markets
Résalieke Vlieger
Communications Manager at Stichting
Pensioenregister, The Netherlands
Panelists

3. |
Which square is darker, A or B?
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A
B
Equal

4. |
Which square is darker, A or B?
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5. |
Hurdles en route to a sound
retirement
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6. |
Snapshot of
Australian retirement system
Good practices in encouraging retirement planning across the population6
• Government pension plus retirement savings plus other savings
• Compulsory retirement saving system for employees introduced 1992,
concessional tax treatment
• $2.046 trillion in superannuation
• 265 superannuation funds
• 568,943 self-managed superannuation funds
• Average super balance age 60-64
– Men: $292,510
– Women: $138,154

7. |
Recent reforms
and current issues
Good practices in encouraging retirement planning across the population7
• Superannuation Guarantee increasing from 9% to 12% by 2025/26,
currently 9.5%
• Superannuation choice - first introduced 2005
• Strong Super reforms:
– MySuper - default option
– Product Dashboards for MySuper accounts
– Portfolio holding disclosure
– Registration of SMSF auditors
• Financial System Inquiry
• Retirement income streams
• Objectives of superannuation

8. | Good practices in encouraging retirement planning across the population8
High-level introduction
UK system
• Pre-2000s – strong ‘pillar 2’ system with predominantly defined benefit (DB)
provision, but in decline:
– defined benefit (DB) – defined contribution (DC) shift
– declining participation
– falling contribution levels
• 2006 reforms - implemented from 2012
Auto enrolment
• Employers must auto enrol
eligible workers
• Set up or choose a ‘qualifying
workplace pension scheme’
NEST
• One ‘qualifying scheme’ (DC)
• Legal obligation to accept any
employer and their workers

9. | Behavioural Economics research9 https://www.youtube.com/watch?v=32_IL_D8LEA
Mexican context …
122 million
inhabitants
54.4 million
accounts
55% of the population
without social security
14.2% of GDP
20 million active
workers
5.88% annual return
Expected replacement rate: 30%

10. |
What does the audience think?
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For adequate pensions, product
and system design are more
important than education
Agree (products > education)
Disagree (education > products)

11. |
What does the audience think?
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Having more choices will ensure
that people more interested in
their pension
Agree
Disagree

12. |
What does the audience think?
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People are not rational when it
comes to pensions, so education
does not work
Agree
Disagree

13. | Behavioural Economics research13 https://www.youtube.com/watch?v=32_IL_D8LEA
From barriers to solutions…

14. |14
1,629
Rural
1,872
Urban
873
Urban
232
Urban
Automatic savings on line
More than 4,600 new points for voluntary
savings
Make it easy…
Convenience stores

15. | Strong call to action15 https://www.youtube.com/watch?v=32_IL_D8LEA
Make it simple…
Key features of
the campaign:
• Simple
message
• Easy goal (€ 1)
• Catchy song
• Popular group
• It´s easy to
save: 4,600
convenience
stores and
webpage
Consumers intention to save
CONSAR Survey

16. |16
Make it clear and repetitive...
Voluntary contributions increased 33% (2014-2016)

17. |
Consumer behaviour
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Step 1
Awareness of a need
Engage with the
system
Step 2
Identify the
functional
requirements
Recognise and
define the
specific need
Step 3
Choose an
appropriate
type of product-
/solution
Match the need
to a type of
product/-
solution
Step 4
Evaluate specific
products/solutions
Select appropriate
product/solution
Step 5
Post-
commitment
evaluation
Continual
assessment of
decision

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21. |
Mijnpensioenoverzicht.nl
The Dutch pension tracking service
The Dutch Pension Tracking Service: Mijnpensioenoverzicht.nl21
from overview - to insight - to action

22. |
Using the ‘mental model’ for design
The Dutch Pension Tracking Service: Mijnpensioenoverzicht.nl22
2. Information presented in layers
3. Using icons obligated throughout the sector
1. Personal timeline with ages and
net amounts per month

23. | The Dutch Pension Tracking Service: Mijnpensioenoverzicht.nl23
STARTERS
20-30 years old
Just have a look
– it’s easy
BUILDERS
30-50 years old
Take care of
your financials
now – for later
ENJOYERS
50-60 years old
Check now if
you want to
know about
your later
income.
• Radio
• Advertising on demand
• Outdoor
• Facebook
Weekly amounts of visitors
Visits to pension providers
• Checking your later income is easy
• Its easier than a lot of your daily
habits
• Surprising, recognisable and
personal
Our national campaign

24. | The Dutch Pension Tracking Service: Mijnpensioenoverzicht.nl24
0
500000
1000000
1500000
2000000
2500000
3000000
3500000
4000000
4500000
2011 2012 2013 2014 2015
Totaal
Cumulatief
Totaal
0
5000
10000
15000
20000
25000
30000
Leeftijd
20
25
30
35
40
45
50
55
60
65
70
75
10 juli - 9 aug 2015
10 aug - 9 sept 2015
10 sept - 9 okt 2015
10 okt - 9 nov 2015
More new unique visitors
More young people
Next steps
Focus on users
Voor pensioenuitvoerders
om zelf risicogroepen t
Waarom spreekt
I love pensioen
vrouwen aan
onlijke
dering
Vrouwelijke
pensioen-
experts
Sluit aan
bij levens-
gebeurtenissen
Gebruik van
beeldtaal
v
Quote
deelnemer
Vrouwen zijn
een risicogroep.
70% is
pensioen-
onbewust
Vrouwen
bouwen
40% minder
pensioen op
Voor pe
om zel
i
Waarom spreekt
I love pensioen
vrouwen aan
Vrouwelijke
pensioen-
experts
Sluit aan
bij levens-
gebeurtenissen
Women as a risk group
40% less
pension 70% not
interested
Key to succes:
Communication
and
co-operation

25. |
Example of interactive tools
Impartial and trusted financial guidance
Good practices in encouraging retirement planning across the population25

26. |
Example of targeted resources
Good practices in encouraging retirement planning across the population26

27. |
Opting out of NEST
Good practices in encouraging retirement planning across the population27

28. |
Opting out of NEST
Good practices in encouraging retirement planning across the population28