Table of Contents
Introduction and Abbreviations
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- Scope of the report
- Global information and research
- Consumer research
- ACORN
- Abbreviations
Executive Summary
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- Stakeholder pensions are still missing their target
- Sales of SHPs are down in the first half of 2003
- The majority of providers have experienced a fall in SHP sales in 2003
- Independent intermediaries experiencing greater distribution share
- The main findings of Mintel’s consumer research
Legislative Background
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- The problem with pensions
- Maximum contribution levels vary according to age
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- Proportion of salary that can be contributed to a personal pension, by age, 2003/04 tax year
- Introducing the stakeholder pension scheme
- The structure of stakeholder pensions
- A wave of similar pension products has besieged the sector
Market Factors
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- The number of people of pensionable age is projected to rise by over 20% by 2026
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- Population growth, by age group, 2001-26
- New Pension Credit scheme to replace the Minimum Income Guarantee
- Will the new Pension Credit encourage more to save?
- Being reliant on the state pension alone is tough
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- State pension levels, 2002/03 tax year
- Rising PDI in a climate of low inflation should enable people to save more
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- PDI and savings ratio, at current prices, 1997-2007
- Pension funds eroded by stockmarket falls
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- The performance of the FTSE 100 index, January 1995-August 2003
- Lowest interest rates for nearly 50 years
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- Official bank base rate, January 1992-July 2003
- More consumers turn to property to provide for retirement
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- Volume and value of new buy-to-let mortgages (half-yearly), 1999-2002
- Company schemes
- Greater involvement by employers needed
Market Size
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- Average earnings fall behind pension contributions
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- Personal pension contributions and average earnings – indices, 1990-2001/02
- Company pensions are still in the forefront of additional pension provisions
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- Ownership of selected pension products, 2003
- Premium contributions dip
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- New individual pensions business, 1994-2003
- Single-premium stakeholder pension sales suffer decline
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- Single-premium stakeholder pension sales (non-employer-sponsored), Q1 2002-Q2 2003
- Regular-premium policies still favoured over single premiums
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- Regular-premium stakeholder pension sales (non-employer-sponsored), Q1 2002-Q2 2003
- Employer-sponsored stakeholder pensions
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- Employer-sponsored stakeholder pension sales, Q1 2002-Q2 2003
Key Players
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- Traditional providers continue to lead as sales remain slow
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- Leading providers of stakeholder pensions, October 2003
- Providers seek removal of 1% cap on charges
- Stakeholder product comparison
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- Selected individual stakeholder pension charges and options, September 2003
- Profiles of the top five providers of stakeholder pensions
- Aviva/Norwich Union
- Standard Life
- Scottish Widows
- HSBC
- Legal & General
Distribution
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- IFAs continue to dominate sector
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- Distribution of new APE individual pension business, by main channel, 1997-2003
- IFAs enjoy a higher distribution share in the employer-sponsored stakeholder sector
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- Distribution of new stakeholder pension business, Q1 and Q2 2003
Advertising and Promotion
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- SHPs promoted under umbrella of general pensions
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- Pension advertising expenditure, by product category, 12 months to September 2002 and September 2003
- More emphasis is placed on retirement planning as a whole
- Advertising spend on SHPs falls by 96%
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- Stakeholder pension advertising expenditure, 12 months to September 2002 and September 2003
The Consumer
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- Some 6% of non-retired consumers are contributing to a stakeholder pension
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- Details of ownership of selected pension plans, September 2003
- Around half of the non-retired adult population have no private pension provision
- Highest SHP take-up among men, 35-44-year-olds, C1s and C2s
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- Contribution to pensions, by type, gender, age and socio-economic group, September 2003
- Single people are more likely to have an SHP, but are less likely to have other forms of retirement provision
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- Contribution to pensions, by type, marital status, lifestage and Mintel’s Special Groups, September 2003
- Highest take-up of SHPs among the middle income group
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- Contribution to pensions, by type, working status, gross annual household income and tenure, September 2003
- Those living in London appear to be the most receptive to SHPs
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- Contribution to pensions, by type, TV region and ACORN categories, September 2003
- Greater television advertising of SHPs may help to improve take-up
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- Contribution to pensions, by type, newspaper readership, new technology users, commercial TV viewing and supermarket usage, September 2003
- Over a third of consumers arranged their SHP directly with a provider
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- Source used to arrange stakeholder/personal pension, September 2003
- ABC1s more likely to use an IFA, while C2DEs favour going direct
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- Source used to arrange stakeholder/personal pension, by gender, age, socio-economic group, working status and region, September 2003
- Some 44% of non-retired adults have never heard of SHPs
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- Level of agreement to three statements about SHPs, September 2003
- Over half of C2DEs have never heard of SHPs
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- Level of agreement to three statements about SHPs, by gender, age, socio-economic group, marital status and lifestage, September 2003
- Full-time workers and those in the middle income group are most likely to considering getting an SHP
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- Level of agreement to three statements about SHPs, by working status, gross annual household income, TV region and ACORN categories, September 2003
- Awareness of SHPs is highest amongst broadsheet readers
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- Level of agreement to three statements about SHPs, by newspaper readership, new technology users, commercial TV viewing and supermarket usage, September 2003
- Those with no provision are least aware of SHPs
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- Level of agreement to three statements about SHPs, by those without provision, September 2003
- More than a fifth of consumers cannot afford to pay into a pension
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- Reasons for not getting a stakeholder pension, in order of importance, September 2003
- The higher income groups have a greater distrust of pensions
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- Top reasons for not getting a stakeholder pension, by gender, age, socio-economic group, working status and gross annual household income, September 2003
- A third of those living in F – Striving neighbourhoods cannot afford an SHP
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- Top reasons for not getting a stakeholder pension, by ACORN categories, newspaper readership, commercial TV viewing and supermarket usage, September 2003
- CHAID analysis identifies C1s/C2s in middle-age groups as potential targets
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- CHAID analysis of main attitudinal statements, September 2003
The Future
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- Still missing the target
- Greater involvement by employers needed
- Reducing debt levels to free up cash for long-term investment
- Awareness has to be improved and pensions aggressively promoted
Forecast
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- Forecast of the number of hot prospects for the stakeholder pensions market, 2003-07
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