06 March 2007 - Publication of DWP research report 413: Needs and preferences of moderate to low earners for retirement information online: small scale qualitative research
New research published today by the Department for Work and Pensions explores information needs and preferences among moderate to low earners for retirement information on the internet. The research examines individuals’ use of the internet, experience of financial planning and knowledge of pensions issues.
The report presents the findings from ten focus group discussions with individuals aged between 21 and 55, earning between £10,000 and £30,000 per year who are internet users. The discussions were recorded, transcribed and analysed by BMRB. The findings will feed into the future development of the Department’s information strategy in the context of pension reform.
The main findings are:
- Focus group respondents had a generally poor level of knowledge about pensions, especially private and stakeholder pensions;
- There was limited evidence of active retirement planning and some participants had no provision at all. Retirement planning strategies mentioned included downsizing property, emigrating, working longer, relying on state benefits or a private pension;
- People generally found it difficult to estimate the amount of money they would require in retirement. Three forms of help would be particularly welcomed: a checklist to establish desired retirement income, a way of calculating how much they needed to save to meet those aspirations and a way to factor in inflation;
- Participants generally welcomed the concept of an internet based retirement planning service;
- However, use of such a retirement planning service is likely to depend on a degree of confidence in using the internet and willingness to deal with financial information online which not all internet users have;
- Respondents wanted to access different types of forecasts reflecting the different types of help needed and also wanted flexibility regarding the amount and type of financial information to be entered;
- Elements required of such a service would be a clear and uncluttered design with a simple and comprehensive system of Help and FAQs, with a save and retrieve function;
- There was little desire for a planning service to automatically collect external sources of information such as information about private pensions. An exception is that an optional link to the State Pension forecast would be welcomed.
- Government branding of the service was suggested in order to provide reassurance regarding the website’s security, impartiality and accuracy;
- The internet was being used increasingly by some participants to obtain financial products, such as insurance and savings accounts, but there was a reluctance to arrange a large loan, mortgage or pension online.
- Although the internet was thought to be a valuable source of financial information, some were concerned that there was too much information available and it was sometimes out of date;
Notes to Editors
- Research Report 413 – Needs and preferences of moderate to low earners for retirement information online: small scale qualitative research is published on 6th March 2007. The report was carried out on behalf of DWP by Dr Andrew Thomas and Richard Brown at BMRB. The report is available on the DWP website and hard copies can be obtained from Paul Noakes, Room 4-26, The Adelphi, 1-11 John Adam Street, London WC2N 6HT.
- The research is based on findings from ten focus groups, each comprising of ten participants, undertaken in Leeds and London in June 2006. In total, 100 adults aged between 21 and 55, in employment and earning between £10,000 and £30,000 per year took part in the research. People who used the internet less frequently than once per fortnight were excluded from the study.
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Prepared by: Department for Work and Pensions Information and Analysis Directorate