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Looking back through 3 years of leading data, taking us from pandemic to present

07/11/2023
RETIREMENT

Our flagship Wealth and Wellbeing Research Programme marked its 3rd anniversary with the publication of Edition 13. Over the last three years we’ve been tracking consumer and mass affluent trends across a variety of topics, from personal mental health to financial wellbeing. For the three-year anniversary of our research programme, we look back over how our research has developed since its launch to help you understand both the hopes and concerns of consumers during a period of exceptional market turmoil and change.  

The launch of our first Wealth and Wellbeing Monitor

September 2020 was an incredibly difficult time, shrouded in uncertainty following the worldwide stock market crash earlier that year caused by growing instability due to the COVID-19 pandemic. This was also the launch of our Wealth and Wellbeing research with the aim to track the impact of Covid on consumers and how it was affecting different age groups’ attitudes to saving, spending and their wellbeing. 

Our pioneering data, which was gathered only three months after we entered a strict lockdown, in June 2020, captured consumer sentiment at a critical time. We found that many were struggling with the repercussions of Covid and were pessimistic about the outlook for their personal finances, while those approaching retirement saw their retirement plans disrupted with 40% saying that their finances had worsened. 

After a year of sharing our wellbeing insights (research conducted in September 2021)1

  • 27% of UK adults said they are worried about the rising prices of day to day items
  • 24% of mass affluent consumers were worried about their savings being devalued by inflation
  • 53% of grandparents gave money to their grandchildren (as cash or by saving/ investing it for them)

While life after lockdown in mid-2021 still had its problems, with consumers starting to feel the pinch of rising prices and increased inflation worries, our data showed that the general outlook had much improved in comparison to the low point reported at the end of 2020. 

Incomes were on the rise, fears of job losses had reduced, and we found that nearly a quarter of UK adults were less in debt than before the pandemic. We began to build on the report by providing some in-depth insight and data to explore how our findings could be used to guide clients in their retirement planning journeys. We also introduced our wellbeing indices to track particularly telling metrics over time. 

One year into our programme, our research also explored consumers’ experience of financial advice during the pandemic, with nearly a quarter (23%) of UK adults in September 2021 saying they had received financial advice since the pandemic started. We also found that many mass affluent grandparents at the time were not getting the best returns when saving for their grandchildren’s future, with most choosing to save into low interest savings accounts and cash ISAs rather than investment accounts. Those who regularly saw a financial adviser were one of the few groups who recognised the benefits of investing for their families’ future, with 26% of that group paying into an investment for their grandchildren.

The cost of living crisis & lack of pension knowledge (research conducted in September 2022)2

  • 5m UK adults couldn’t afford their day-to-day costs and bills
  • 23% of working adults did not know how much they were paying into their pension
  • 52% of the mass affluent who weren’t investing said they were too worried about volatility to do so

Two years into our longitudinal study, with the UK political and economic environment in a state of flux, our data delved more into how the cost of living crisis was affecting consumer attitudes towards investing, how the climate had impacted their investments and their understanding of pensions. Our research found that 58% of workers in September 2022 did not know how to ensure they don’t run out of money in retirement. 

We continued to explore this theme of pension knowledge as we continued our research programme to explore what consumers are looking for when it comes to pension investments. Our 11th wave revealed that over a third (37%) of workers with a DC pension said that, in retirement, their preference would be to receive both a set income and have a pot of money to draw from3.

Three years on

  • 29% of retirees helped friends or relatives financially
  • 28% of retirees are struggling with physical health problems
  • 18-34 year old workers are opting out of employee pensions due to costs

In June this year the Bank of England increased the UK interest rate to 5%, the highest the country had seen in 15 years. This increase followed a period of political instability and a continued cost of living crisis. Sustained financial strain has increased the number of 18-34 year old workers wanting to opt out of employee pensions due to costs, and has also had an effect on retirees.  29% of have been helping friends or family financially, with over 1 in 10 of those doing so using their own pension. 

Since the economic turmoil of 2020, Edition 13 of our research indicated that many people are still struggling three years on, and they’ve been under strain for a significant period. This led us to launch the LV= Wellness Tracker, a unique metric that provides an indication of how we are coping financially as a nation. We have tracked the figure back to the beginning of our research, and the current figure suggests that the nation’s financial resilience is lower now than during the pandemic.

Today, we are incredibly proud of how our research has developed over the last three years to provide excellent insights that can help drive your conversations with clients. Take a look at our article to find out more about our new Wellness Tracker and the nation’s current score. 

To see the full LV= Wealth and Wellbeing 13 data, as well as more findings from the research, download your copy of the report.

 


 

1LV= Wealth and Wellbeing Research Programme, Edition 6

2 LV= Wealth and Wellbeing Research Programme, Edition 10

3 LV= Wealth and Wellbeing Research Programme, Edition 11