The Pensions Management Institute (PMI) and Schroders have partnered on the launch a new Lifetime Savings Initiative (LSI), which aims to identify, understand and propose solutions to the "fundamental challenges" savers face when managing their money.

The multi-stage project is set to look across the entire UK savings system to help identify actionable recommendations for industry and policymakers that solve key pinch points preventing people from being able to secure their financial future, and in doing so, create a more sustainable national lifetime savings model.

The first stage of this work is aimed at defining the extent of the problem, before identifying solutions and seeking to deliver change by handing recommendations to policymakers in a white paper later this year.

The duo has already shared the outputs of the first phase of work, identifying three key areas in which UK savers need support: Financial resilience, rising costs of housing, and long-term retirement needs.

Indeed, the research cited evidence from the ONS that showed that over a fifth (22 per cent) of adults are borrowing more money to keep up with living costs, while data from the Financial Conduct Authority has shown that one in four adults have low financial resilience.

In addition to this, the report highlightedevidence from the Pensions Policy Institute, which showed that the proportion of pensioner households renting privately during retirement could increase three-fold over the next 20 years.

It also pointed to analysis from Deloitte, from 2015, which suggested that the UK is on track for a £350bn annual long-term savings gap by 2050.

The report is intended to "spark" a broader conversation and build consensus about how to address the challenges of the current lifetime savings market, with the next phase of the project set to focus on practical solutions to the problems that have been identified.

This work is set to begin in Q1 2024, while the stage three whitepaper, which will focus on delivering change with key recommendations for policymakers, is set to be shared in "autumn 2024".

Commenting on the launch, PMI chair, Ruston Smith, stated: “We are today announcing we have delivered on the first stage of this initiative: defining the problem.

"We have identified key pinch points which are preventing people from building financial security in both the short and long-term.

"As this is such an important societal problem, spanning across a number of regulatory regimes, we want to share our insights and take a collaborative approach to broaden the discussion.

"We want this initiative to be a real force for positive change, to help people have easier and better choices and therefore better outcomes and greater financial security.”

Schroders Solutions executive chairman, James Barham, added: “We hope that the breadth and depth of our panel will help to break down the silos between different areas of the savings system and allow us to build a consensus around what needs to be done to address the key challenges facing people saving today.

“Many stakeholders are worrying about these problems and a great deal of splendid work has been done already. This is why we are sharing our data pack now, in the hope that we can enrich the debate, and spark more conversations.

"It makes for sobering reading, but our hope is it acts as a trigger for more people to join the debate.

“Because together we passionately believe that if we can address some of the problems of the lifetime savings market the benefits to the UK, and its millions of citizens is almost immeasurable.”

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