Our new product offers customers more control over their future finances.

Jackie Leiper
Head of Pensions, Lloyds Bank
14 May 2024
3 min read

We all know that managing money can be time consuming and complicated, which means that dealing with ‘money stuff’ can often be pushed to the bottom of the to-do list. But this procrastination can mean that people are living with – and spending money on - products that may not suit their needs.

A recent survey conducted by Lloyds Bank found that UK adults estimate they could save £300 a year by cancelling unused subscriptions, and £420 by reviewing their day-to-day finances. However, a reluctance to engage with their finances often gets in the way of making the necessary changes to save this money. 

This lack of engagement can impact their long-term financial planning too, meaning that they’re missing out on money that could boost their long-term savings. The survey found that a fifth of UK adults don’t have any form of pension savings and just two fifths (42%) know how to add more money to their pot.

To help engage more people in pensions and make financial planning for the future much simpler, we have launched Ready-Made Pension: an in-app proposition accessible to existing customers using our Lloyds Bank, Bank of Scotland and Halifax banking apps to help them open a new personal pension, consolidate existing pension pots in one place and take control of their financial future.

“Over a third (35%) of UK adults use a banking app every day, and so the Ready-Made Pension is designed to be seamlessly incorporated into people’s established daily banking routines.”

Why is there this reluctance for people to engage with their finances?

The complexity of financial management and feeling that it might just take too long, are significant barriers people face when it comes to engaging with their money, and making changes that will benefit them in both the short and longer term. For example, one in five people (20%) said it was just easier to leave their mobile contract rather than speak to their provider and see if they could get a better deal. 

But, by making things simpler, we can help to improve people’s engagement levels. Nearly two fifths (37%) of people surveyed say they could cancel unused subscriptions quickly because they can do it on an app, while a quarter (24%) said the same for reviewing their pension contributions. 

Our in-app subscriptions checker has helped customers to quickly and easily identify where they make regular payments, and in the first quarter of 2024 alone we’ve seen over half a million subscriptions cancelled. In the same way, we wanted to remove the barriers that people face when it came to saving for their retirement, which is why in April we launched the Ready-Made Pension, giving over 21 million customers the tools to start a personal pension in minutes. 

What is a Ready-Made Pension?

The Ready-Made Pension is exactly what it sounds like; a personal pension that can be opened through one of our Lloyds Bank, Halifax or Bank of Scotland banking apps, and is shown alongside customer’s existing bank accounts. Over a third (35%) of UK adults use a banking app every day, and so the Ready-Made Pension is designed to be seamlessly incorporated into people’s established daily banking routines.

Financial complexity has often been seen as a barrier to people being able to save, so the Ready-Made Pension aims to address this and keep things simple. Customers’ details are all pre-populated when they open the product, so they don’t have to spend hours filling out forms. 

The proposition is then tailored to customers’ age and retirement plans and managed by experts, which is easy for a customer to track and alter should they need to. There are also in-built explainers and guides on tricky topics, like tax, so that customers get a better understanding of what they can expect from their money. Customers can then set up regular or one-time payments, so that they can get on-track to reach their retirement savings goals.  

Those with a Ready-Made Pension can also consolidate existing pension pots, enabling them to have all their long-term savings in one place. This can help to cut down on multiple fees across different pension providers, as well as to help avoid losing any pots in future. 

"The Ready-Made Pension proposition brings together the pensions expertise of Scottish Widows, the award-winning platform and know-how of Embark, and the reach of our high street banking brands."

Ready-Made Pension: Making saving for retirement simpler

How will Ready-Made Pension help customers manage and grow their money?

According to the 2023 Scottish Widows Retirement Report, 35% of people aren’t on track for an even minimum retirement lifestyle in retirement – which means a third of people are at risk of not having their basic needs covered. This is a huge societal issue, and requires effective collaboration across the government and pensions industry to help address.

Developing a proposition that’s genuinely simple to access, easy to use and that would help people to think of their pensions savings with more immediacy can, perhaps, help to play its part in making sure more people reach retirement with adequate savings. 

The proposition can help to remove the complexity of pensions payments. Just two fifths of UK adults (42%) know how to add more money to their pot, but with the Ready-Made Pension customers can set up regular or ad-hoc payments in the same way you would with any regular savings account. This ease is crucial, as by helping people to make small savings now, it can make a significant difference in retirement. Taking advantage of compound interest from a young age means someone can build up a sizeable pot with smaller contributions. 

Scottish Widows 2023 Women & Retirement report

The latest Women and Retirement report dives deeper into some of the reasons behind the gender pension gap.

Download the full report (PDF, 3.8MB)

How can Ready-Made Pension help self-employed workers?

Our Ready-Made Pension proposition is for everyone who banks with us, as it offers a clear and easy-to-use solution for all those in full-time employment, to sit alongside their employer pension, or for those who are self-employed, who are less likely to already have a pension. 

Indeed, Ready-Made Pension could be especially helpful for those in self-employment or for those with fluctuating incomes, as they can invest differing lump sum amounts, as well as – or instead of – setting up a regular payment. Self-employed people are often overlooked in retirement discussions. Between April 2018 and March 2020, only 20% of self-employed people were paying into a pension compared with 80% of employees. 

Since the introduction of auto-enrolment, the pensions savings gap between those in full-time employment and self-employed people has grown significantly. The average full-time employee is on track to receive £27k a year in pension income, which is nearly three times what the average self-employed person is on track for (£10k). As a result, a majority (just below 50%) of self-employed people are not currently on track for even a minimum lifestyle.

While the Ready-Made Pension can help to give self-employed workers a simple tool to help manage their pension savings, more still needs to be one to help close that gap. A more cohesive approach is needed by the government to help build an ecosystem within which the self-employed save.

Why are we the right people to launch this product?

We're the only financial services company in the country that can bring banking and insurance together under one roof – and we know it's easier for our customers’ to have all their financial needs met within a single environment. The Ready-Made Pension proposition brings together the pensions expertise of Scottish Widows, the award-winning platform and know-how of Embark, and the reach of our high street banking brands, so that we can help more people save towards their future. 

About the author Jackie Leiper

Head of Pensions, Lloyds Bank

Jackie has over 25 years' experience in the financial services industry, with specialism in life and pensions, and a focus on leading customer and client facing teams. She joined the Group in 2010 to lead one of our large operations teams, fulfilling a number of leadership roles before assuming her current position in 2018, where she is responsible for pension proposition development, distribution of Scottish Widows flagship pensions and protection products, and the Halifax Share dealing business.

Jackie is a huge advocate of raising awareness of financial resilience, particularly for women. She is an industry-recognised advocate for driving societal and political change that will help close the gender pensions gap.

Follow Jackie on LinkedIn.

Jackie's background Read less

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