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21 Jul 2021

How delivering a more personalised approach to financial education is evolving

From social media trends to buying beverages with your name on them, personalisation is everywhere. It’s not surprising; for two broad reasons. First, we like to feel special – it’s human nature. Second, it provides a better user experience. Social media sites show us content we’re more likely to like – literally – and, being able to filter products on a website allows us to browse more effectively.

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So how does this impact the world of employee benefits and financial wellbeing?

High demand

First of all, we’re seeing a real need for personalisation. Perhaps more than ever, generational differences mean there is a greater need to personalise financial education and guidance. An obvious example is accommodation. The housing market is very different to how it was 20 or 30 years ago, which means Generation Z and late Millennials will face very different housing costs to Generation X.

Additionally, we will start to see greater diversity in pension arrangements. As Defined Benefit (DB) schemes become less common – only 5% of companies reported they had a DB scheme in our UK Benefits & Trends Survey 2021 survey – we will start to see more Defined Contribution pension plans emerge. Combined with auto-enrolment, not only does this place a greater onus on the individual to save from an early age, it also requires proactive financial planning to ensure there is enough resource to fund the desired retirement lifestyle.

A huge part of this is ensuring that your financial wellbeing strategy is communicated effectively; segmenting your workforce and targeting them with the right information for the life stage they’re at.

Technology-driven

It would be remiss to talk about personalisation without mentioning technology. Technology, of course, is the driver behind effective and easy mass personalisation. In the UK, three-quarters of the population use online banking. From buying cryptocurrency to checking investment returns, personal finance and technology are inherently entwined.

But when it comes to the employee benefits industry, we’re perhaps not quite as evolved as our business-to-consumer (B2C) counterparts. Sure, we have personalised pension dashboards and financial wellbeing apps available – but uptake is low. According to Aon’s our UK Benefits & Trends Survey 2021, only 22% of companies are using an app to engage employees with their health and financial wellbeing.

And yet, people are using apps more than ever; time spent on apps increased by 40% between Q1 2020 and Q2 2020, with 35 billion app downloads and record-levels of app-related expenditure in Q2. There is a clear divide between B2C consumer experience outside of the workplace and the employee benefits technology provided by employers.

This is a real missed opportunity for employers. Not only does technology easily facilitate personalisation, good implementation can potentially increase engagement and drive long-term behaviour change. Technology isn’t just the channel, it can also be a driver of good financial wellbeing.

If you’d like to see how your existing financial wellbeing strategy stacks up – try our free gap analysis.

This article is provided by Aon.

In partnership with Aon

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