Around one in five members have begun their guided retirement planner journey in the 12 months since its launch, with many experiencing a significant boost to their retirement readiness as a result, an update from Legal & General has revealed. 

The data showed that there has been a shift in how defined contribution (DC) members prepare for retirement by turning engagement into action, as, of those who have begun their guided retirement planner journey, there has been a 50 per cent reduction in members facing shortfalls after adjusting their plans.
 
Of these members, two-thirds are now building their retirement plan, while one in three have completed one, and one in five have taken tangible action: consolidating their pots, entering drawdown or buying an annuity.
 
The tool, which was launched ahead of the FCA's new targeted support framework, uses technology to support DC members in a more personalised, dynamic way: responding in real time to what the user inputs.

It also means its content is adapted to a member’s individual needs and preferences, while helping to break down complex decisions into simple steps and offering personalised nudges based on behavioural segmentation. 

Following the expansion of the tool to younger members, one third of members using the planner are pre-retirement age (average age of 42), with the goal of helping them to plan earlier and make small, steady decisions to close future savings gaps.

From amongst this group of pre-retirees, over half have started building their plan, and one in three have already completed their plan.
 
Commenting on the findings, L&G DC and workplace savings CEO, Paula Llewellyn, said: “The boundary between advice and guidance is evolving, and the introduction of targeted support next year is an important step in helping our members get the right support.

"For clients, the planner provides an opportunity to enhance and personalise the support available to members. 

"Our goal is to make guidance and advice work hand in hand by combining accessible digital tools that drive better and lasting engagement at scale, with deep behavioural insight.
 
“As an industry, we tend to focus on actions that are easy to measure. But we’re aiming not just to track engagement, but to change behaviour and improve outcomes.

"The strong response we’re seeing, including from those many years away from retirement, shows how combining technology with our lifetime savings expertise can turn awareness into meaningful action.”
 

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