Legal and General (L&G) has announced plans to develop new digital guidance to help give defined contribution (DC) savers better retirement outcomes, enhancing its at-retirement proposition.

The digital guidance is based on member insight, data analysis and behavioural science, and centres on simple, individualised support.

L&G said this is “crucial” to help counteract low levels of understanding, engagement and financial confidence in pension savings.

The service will use nudges and tailored support to help its DC workplace members achieve retirement goals.

The firm added that a holistic financial view within the journey will allow for full consideration of each person's assets, while flexibility enables the income solution to adapt alongside the saver’s retirement.

The digital guidance encourages members to review potential shortfalls in income by bringing together all finances.

L&G suggested that today’s retirees face the challenge of navigating “complex” financial decisions to choose the retirement options that are right for them, arguing that weighing up the income needed for their desired retirement is a difficult decision.

These factors, supported by regulated guidance in future years, aim to improve retirement incomes for DC savers whether in their early retirement or later years.

Commenting on this, L&G retail chief executive officer, Bernie Hickman, said: “The way people understand and engage with their retirement needs to be transformed so they can have better outcomes.

“Our new at retirement digital guidance will be accompanied by both a chatbot and phone-based support as well as access to financial advisers.

“It is based on deep insights into how people think, act and behave when it comes to their retirement, so we can serve our 5.3 million DC Workplace members even better.

“Factors such as multiple income sources, the risk of outliving savings, accounting for market volatility and managing spending over the long-term must be considered.

“Retirement income needs to be sustainable across the course of a saver's lifetime to ensure longevity and avoid a ‘cliff edge’ in savers’ later years.”

---