The PMI and Schroders are spearheading - The Lifetime Savings Initiative (LSI) bringing together influential stakeholders from across consumer, savings, and pensions markets with an aim to identify, understand and propose solutions to the fundamental challenges faced by people in managing their finances.

In December 2023 Schroders convened a Summit of key individuals who deliberated on these pressing issues. This has helped to shape our initial scope mapping out three critical areas where UK savers require support:

• Financial resilience
• Rising costs of housing
• Long-term retirement needs

The culmination of industry insights in the report launched today emphasizes the urgency of the situation from a broad spectrum of sources. Over a fifth (22%) of adults are borrowing more money to keep up with living costs¹, the proportion of pensioner households renting privately during retirement could increase 3-fold over the next 20 years² and the UK has a projected £350 billion annual long-term savings gap³.

The LSI operates as a multi-stage initiative, beginning with defining and quantifying the extent of the problem, then transitioning to identifying actionable solutions. The goal is to deliver recommendations to policymakers through a white paper later this year.

Schroders and the PMI have disseminated the findings of the initial phase to senior stakeholders across various sectors, aiming to ignite broader conversations and consensus-building on addressing the challenges within the lifetime savings market. With expert panels guiding the way, the focus now shifts to devising practical solutions.

Schroders and the PMI will continue, alongside their expert panel, to the next phase, focusing on practical solutions to the problems that have been identified.

Ruston Smith, Chair, Pensions Management Institute, said:
“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.”

James Barham, Executive Chairman, Schroders Solutions, said:
“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.”

The LSI's scope extends beyond traditional pensions and savings specialists, encompassing a diverse array of organizations such as retailers, charities, unions, insurers, and fintech companies. This inclusive approach reflects a commitment to fostering holistic solutions.

This is just the beginning of our journey, and we are committed to keeping you informed about the project's progress as it unfolds. In the meantime, we welcome your feedback and insight which will be instrumental in driving this exciting project forward.

The PMI takes pride in spearheading this vital agenda, recognising its potential to shape the future of pensions in the UK. Together, with collaborative efforts and collective determination, the LSI aims to pave the way for a more secure financial future for all.

Click here to read the LSI report in full.