The government has launched an enhanced digital Midlife MOT supporting people with their work, health and money. Louise Davey, Interim Director of Regulatory Policy, Analysis and Advice, explains how and why pensions schemes should encourage take-up among their members.
The nature of work and retirement is changing. People are living longer, working across multiple jobs over the course of their lives, and approaching retirement differently so that they can make full use of the freedoms afforded to them. But upfront planning on how you want to spend your later life makes an enormous difference to what is on offer.
The Midlife MOT, provided online and through Job Centres in some parts of the UK, enables workers in their 40s and 50s to take stock of their finances, skills and health.
Now, a newly launched enhanced digital Midlife MOT brings together trusted services, tools and charity resources from the NHS, Money Helper, Mind, Citizens Advice and the Department for Work and Pensions (DWP), to help more people to plan for their future. Helping them to:
- review their transferable skills and search for a more appropriate job to suit their circumstances
- think about how they can better manage their health to stay in work
- restructure their household budgets to achieve their financial goals and plan for later life and their retirement
The money section of the digital Midlife MOT aims to help savers, and involves a digital tool, asking questions covering debt, budgeting, insurance and pensions. People can educate themselves on the pensions basics, check their state pension age, find any lost pension pots, establish their ideal retirement income and go through a step-by-step guide to boosting their pension and planning their retirement income.
The launch of the new digital resource comes when the spotlight is being thrown on how schemes should support savers when they access their defined contribution pensions.
DWP has announced measures for consultation, to see savers supported to make good decisions on using their pension pots for their retirement, involving a larger and more central role for occupational pension schemes in providing decumulation products and services. All pension savers deserve value for their money, and that means being supported into high-quality decumulation products and services that are right for their personal circumstances.
In our joint review of the pensions consumer journey with the Financial Conduct Authority we set out our support for the Midlife MOT because we know that pensions cannot be seen in isolation: levels of saving and debt, day-to-day household finances, how long people plan, need or want to work, all need to be factored in as we live longer. That planning should start sooner rather than later. Taking the Midlife MOT should be seen as an essential part of the pensions journey.
That is why we are urging pension schemes to signpost this offer to their members.
How can pension schemes help?
Signposting can be through the communication channels you think are most effective, however we would suggest that:
- you particularly target those in the 45 to 65 age range
- fully integrate the Midlife MOT into the support you already offer to your members
- provide this link to Midlife MOT in your signposting, so that DWP can capture where visitors are being referred from
To help, we are providing some text below that schemes can draw on for their own member communications.
Check the status of your work, health and money with the Midlife MOT
Bringing together a wide range of services, tools and resources, the DWP digital Midlife MOT has been designed to help you think about your work, health and money, with future planning in mind. Whether you want to take stock of your finances, enjoy a healthy working life or plan for a more secure retirement and review your pension arrangements, the digital Midlife MOT can help provide the support you need.
Bringing together a wide range of services, tools and resources, the DWP digital Midlife MOT has been designed to help you think about your work, health and money, with future planning in mind.
The Midlife MOT has information and support to help you assess your current circumstances and take appropriate action, whatever your future goals may be. Whether you want to review your pension arrangements and plan for later life, think about how you might improve your health to stay in the job you enjoy, or consider whether now is the time to see what transferable skills you have to start a new career, the Midlife MOT is a great starting point, and an important website to revisit as your circumstances change.
It can be difficult to find the time to think about and prepare for your future, and hard to know where to start. But whether you want to take stock of your finances, enjoy a healthy working life or plan for a more secure retirement, the Midlife MOT is a great first step.
By Louise Davey, Interim Director of Regulatory Policy, Analysis and Advice