05 May 2009 – Publication of DWP summary of key findings from ‘Individuals attitudes and behaviours around planning and saving for later life.’
A summary of key findings is published today by the Department for Work and Pensions which presents high level findings from multi staged qualitative and quantitative research. This research, which was co-funded with the Personal Accounts Delivery Authority (PADA), set out to explore individuals’ attitudes towards planning and saving for later life and included an audience segmentation of people of working age. The segments are grouped together based on the common attitudes and behaviours held by respondents in each segment.
The main qualitative findings were as follows:
People’s attitudes to money are deeply ingrained indicating a very wide range of confidence and preparedness for a financially secure retirement. The research uncovered three overarching attitudinal types that suggest where individuals differ in their money management behaviour;
- Spenders: people who only ever manage to spend money. Their perception is that money “flows through their hands” and, however much they earn, they never have anything left at the end of the month;
- Apportioners: people who are good at setting money aside for specific tasks (for bills/holidays), using a mental accounting technique of setting money into (imaginary, although sometimes literal) “pots”. This mental accounting technique is consistent with behavioural economic theories;
- Money growers: People attracted by the notion of investing money somewhere it will grow.
This qualitative research provided a foundation on which to develop the quantitative survey. The quantitative research identified five key segments. The five segments are grouped together based on the common attitudes and behaviours held by respondents in each segment;
- The ‘Really Sorted’ segment have plans for and are confident about retirement. People that fall into this segment are likely to be contributing to a wide range of financial products, and are also likely to be financially knowledgeable and responsible.
- The Maybe Sorted segment also have plans for their retirement and say they are confident about their plans for the future. However, they tend to rely on someone or something which could ultimately be outside of their control, e.g. working into later life or a partner’s pension.
- The Competing Priorities segment have plans but are anxious about their retirement. They have various demands on their income, and possibly more financial commitments than they can afford.
- The Unprepared segment is predominantly made up of younger people who are optimistic about the future but without plans in place for their retirement. This group of people are encouragingly positive about the future and have time to make plans for the future.
- The final segment is the Daunted. This segment includes those people with the lowest financial resources, who tend to be scared about pensions and the future.
Notes to Editors
- This research has been invaluable in identifying key attitudes and behaviours towards planning and saving for later life across the working age population.
- The summary of the research findings can be found at: http://research.dwp.gov.uk/asd/asd5/
- Full research findings will be published in the DWP Working Paper Series in June/July, 2009.
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