It’s always interesting when you see two different approaches to solving the same problem. If you’ve ever spent time in Australia (and eat fast food), you will know they have an infinitely better way of dispensing ketchup than our hard to open greasy little sachets. Not one of life’s most fundamental areas I’ll admit, but having seen this over 15 years ago I’m curious why the same approach hasn’t been adopted here.

When it comes to long term retirement savings the stakes are much higher. We all know there are three key variables to play with:

1. How much you save
2. Which funds you choose to invest in
3. How long you save for

Yet in supporting customers in saving, different parts of the market place a greater degree of emphasis in different elements.

In workplace pensions, where matching of employer contributions is important, the emphasis is centred around how much you save. From employer communications to pension providers digital engagement journeys, contribution amount takes absolute priority.

Away from the workplace in retail, the exact same individual opening a new product will face a different experience. While the amount you can save is clearly not ignored, the overwhelming focus for education and decision making is around where you should invest.

This can be explained to some extent by compliance and risk differences between the workplace and retail markets, but that can not be the whole story.

Another argument would be the profile and needs of the customer are different. While workplace pension savers have the benefit of some form of employer contribution (so making the “how much you save” element more significant), overall their ability to afford to save more should not be different to the average retail customer.

And retail customers have self-selected to start saving (as opposed to being auto-enrolled) so could arguably be classed as more engaged, but that should not naturally follow that they will want and benefit from focusing most attention on the investment decision they need to make.

If we want to drive the best customer outcomes, we need to help people understand the relative impact different decisions they can make will have. In doing so we also need to avoid choice overload (well covered here by our friends at Club Vita). 

The question remains are workplace savers paying too little attention to their investment strategy or are retail savers not recognising the value of saving that bit more?

Most importantly for the industry and regulators, is the difference in proposition design and customer journey between workplace and retail truly reflective of the differing needs of separate customers?

If not, there is much to be gained from learning from the others approach.