Even though I work for a pension technology company and believe passionately in what technology can do, I can still acknowledge that it is not a silver bullet to solve all the problems that persist in the pension fund industry. Rather, I believe that the combination of technology and people will enable us to do more together.
Computers and AI are unmatched when it comes to speed and accuracy, processing vast data sets swiftly and with precision. Automation is their forte, taking over repetitive tasks and allowing us humans to focus on strategic endeavours.
Humans possess a remarkable capacity for creativity, often coming up with novel ideas and solutions. Our emotional intelligence enables us to navigate intricate social interactions and empathize with others. We excel at understanding various contexts and adapting our knowledge to diverse situations.
The most powerful outcomes often result from human-computer/AI collaboration. Below are a few examples.
Education and awareness are key challenges in pension planning. Technology can play a crucial role in improving financial literacy through online resources, interactive tools, and gamified educational content. Human experts, such as financial advisors or pension consultants, can then build on the digital learning by creating context and helping members to understand the nuances of what they have learned
Humans are also better at interpreting the questions that members sit with after engaging in digital learning. Combining technology's scalability with human expertise's personalized touch, ensures that members receive the most relevant information and advice.
Secondly, technology is great at offering interactive planning tools that allow pension fund members to model different retirement scenarios. These tools can incorporate various factors like contributions, investment choices, and retirement age all helping individuals visualize the impact on their future financial well-being that their decisions today will have.
Human advisors can complement these tools by offering deeper insights and context to the results generated by the digital platforms. They can help members interpret the data, navigate complex regulations, and adjust based on changing circumstances.
In this information age where we need to continually make decisions, we can use technology to automate a big portion of our retirement journey. Features like automatic enrolment and contribution escalation can nudge members to save more and stay on track towards their retirement goals. Human advisors can step in and offer members the reassurance that they are doing the right thing and are on the right track. We all need someone to tell us we are doing the right thing, and this kind of emotional intelligence is impossible for AI or technology to achieve.
Finally, as members approach retirement age, technology can assist in creating a comprehensive retirement income plan. Digital tools can factor in various income sources, such as pensions, savings, and Social Security, to estimate retirement income and expenses. Technology is great at crunching these numbers and then allowing humans to step in and interpret the results, answer specific questions, and navigate the complexities of annuities, tax implications, and estate planning, ensuring a secure and comfortable retirement.
The synergy between technology and human expertise offers tremendous potential to enhance the financial outcomes and well-being of pension fund members in the UK.
By providing accessible education, interactive planning tools, automated solutions, retirement income planning, and continuous monitoring, we can empower individuals to make informed decisions, save more effectively, and retire comfortably. Embracing the harmonious collaboration of technology and human support, working together to secure a brighter retirement for all is the best solution for the industry.
Jaco Wasserfall, Chief Executive and Founder of PensionSmith
