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The Over-65s and Financial Services - UK - August 2017

“The over-65s have significant spending power and financial knowledge that they share with other family members. However, they are often overlooked by financial services providers, or marketed to via patronising representations of how life should be at this age. Recognising the diversity of financial needs among this age group is important if providers are to meet their needs effectively.”
– Jessica Galletley, Financial Services Analyst

This Report looks at the following areas:

  • Older consumers still need to be shown the benefits of online services
  • Taking a family-focused approach to wealth
  • Make finances easy so people can focus on the important things in life

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Table of contents

  1. Overview

    • What you need to know
      • Report definition
      • Executive Summary

          • The market
            • Over-65s account for growing share of the population
              • Figure 1: Population of over-65s and the proportion of over-65s in the total population, mid-1971-mid-2015
            • Over-65s are the most confident about health of their finances
              • Figure 2: How respondents would describe their financial situation, by age, June 2017
            • Financial services industry looks to address needs of ageing population
              • Three in four use online banking at least once a month
                • Figure 3: Use of different retail banking channels, July 2016
              • Addressing the needs of more vulnerable customers
                • The consumer
                  • Two in five have no financial priorities
                    • Figure 4: Financial priorities, May 2017
                  • Majority feel uncomfortable managing their finances online
                    • Figure 5: Level of comfort managing and arranging finances online, May 2017
                  • Three in four can’t be convinced to use online methods
                    • Figure 6: Actions to increase comfort levels with online methods for managing financial products, May 2017
                  • Over half don’t want to receive documents online
                    • Figure 7: Receiving documents online, by internet usage, May 2017
                  • One in five over-65s feel that finance marketing is patronising
                    • Figure 8: Attitudes towards financial services providers and how they cater to older consumers, May 2017
                  • Recognising the impact of financial decisions on family
                    • Figure 9: Attitudes towards finances and family, May 2017
                  • What we think
                  • Issues and Insights

                    • Older consumers still need to be shown the benefits of online services
                      • The facts
                        • The implications
                          • Taking a family-focused approach to wealth
                            • The facts
                              • The implications
                                • Make finances easy so people can focus on the important things in life
                                  • The facts
                                    • The implications
                                    • The Market – What You Need to Know

                                      • Over-65s account for growing share of the population…
                                        • …and are the most confident about health of their finances
                                          • Financial services industry looks to address needs of ageing population
                                            • Three in four use online banking at least once a month
                                              • Addressing the needs of more vulnerable customers
                                              • The Over-65s Consumer

                                                • A diverse group
                                                  • Over-65s account for growing share of the population
                                                      • Figure 10: Population of over-65s and the proportion of over-65s in the total population, mid-1971-mid-2015
                                                    • Retirees in work
                                                        • Figure 11: Current working situation, May 2017
                                                      • Over-65s are in better financial position than younger age groups
                                                          • Figure 12: How respondents would describe their financial situation, by age, June 2017
                                                        • Retired households have seen income rise at a faster rate
                                                            • Figure 13: Index of growth in household income, at 2015/16 prices, 1977-2015/16
                                                          • Over-65s’ wealth makes them a target for savings providers
                                                              • Figure 14: Value of savings and investments, by age, October 2016
                                                            • Number with no outstanding unsecured debt has risen
                                                                • Figure 15: Amount owed on unsecured credit products, 2014-17
                                                            • Regulatory Context

                                                              • FCA developing strategy for ageing population and financial services
                                                                • Financial Capability strategy for older people in retirement
                                                                  • Pension Freedoms lead to change in consumer behaviour…
                                                                    • …but few are taking advice
                                                                    • Accessing Financial Services

                                                                      • Over-65s reliant on in-branch counter services…
                                                                        • …but three in four use online banking at least once a month
                                                                          • Mobile banking services significantly less popular
                                                                            • Figure 16: Use of different retail banking channels, July 2016
                                                                          • Around half of over-65s use online methods to purchase insurance
                                                                            • Figure 17: Method of purchasing insurance policies, by age, September 2016
                                                                        • Market Developments

                                                                          • Addressing the needs of vulnerable older customers
                                                                            • Vulnerability Taskforce
                                                                              • Nationwide offers a ‘Helping Hand’
                                                                                • Banks focus on making it easier for carers to support
                                                                                  • Vulnerability training at Santander
                                                                                    • RBS and NatWest support customers with community services
                                                                                      • Addressing the issue of dementia
                                                                                        • Slowing things down
                                                                                          • Lending into retirement is a growing trend
                                                                                            • Raising maximum age lending limits
                                                                                              • Equity release hits £2 billion mark in 2016
                                                                                                • Brands move away from ‘old people’ image
                                                                                                  • Saga wants older customers to ‘Keep doing’
                                                                                                    • Just aims to guide people through decisions in retirement
                                                                                                      • SunLife challenges stereotypes
                                                                                                      • The Consumer – What You Need to Know

                                                                                                        • Two in five have no financial priorities
                                                                                                          • Majority feel uncomfortable managing their finances online
                                                                                                            • Three in four can’t be convinced to use online methods
                                                                                                              • One in five over-65s feel that finance marketing is patronising
                                                                                                                • Role in family finances changes after age 75
                                                                                                                • Financial Priorities

                                                                                                                  • Two in five have no financial priorities
                                                                                                                    • A quarter put helping their family financially first
                                                                                                                      • Figure 18: Financial priorities, May 2017
                                                                                                                    • Over a quarter still feel the need to save…
                                                                                                                      • …with a need to build emergency savings
                                                                                                                        • Figure 19: Financial priorities, by household income, May 2017
                                                                                                                      • Financial priorities fall once people reach 65
                                                                                                                        • Figure 20: Financial priorities, by age, May 2017
                                                                                                                    • Comfort with Managing Finances Online

                                                                                                                      • Majority feel uncomfortable managing their finances online
                                                                                                                        • Figure 21: Level of comfort managing and arranging finances online, May 2017
                                                                                                                      • Comfort levels vary by demographic status
                                                                                                                        • Figure 22: Level of comfort managing and arranging finances online, by socio-economic status, May 2017
                                                                                                                      • 55-64s are generally comfortable online
                                                                                                                        • Figure 23: Level of comfort managing and arranging finances online, by age, May 2017
                                                                                                                    • Encouraging the Use of Online Methods

                                                                                                                      • Three in four can’t be convinced
                                                                                                                        • Figure 24: Actions to increase comfort levels with online methods for managing financial products, May 2017
                                                                                                                      • Biometrics could be the solution to security concerns
                                                                                                                        • Internet users know what will improve their experience
                                                                                                                          • Figure 25: Actions to increase comfort levels with online methods for managing financial products, by internet usage, May 2017
                                                                                                                        • 55-64-year-olds more open to online methods
                                                                                                                          • Figure 26: Actions to increase comfort levels with online methods for managing financial products, by age, May 2017
                                                                                                                      • Receiving Financial Documents Online

                                                                                                                        • Financial services providers look to cut down on paper statements
                                                                                                                          • Over half don’t want to receive documents online
                                                                                                                            • Figure 27: Receiving documents online, by internet usage, May 2017
                                                                                                                          • Insurance renewals lead the way in online documentation
                                                                                                                            • ABs significantly happier receiving online documentation
                                                                                                                              • Figure 28: Receiving documents online, by internet usage, by socio-economic group, May 2017
                                                                                                                          • Attitudes towards the Treatment of Older Customers

                                                                                                                            • One in five think finance marketing is patronising
                                                                                                                              • Figure 29: Attitudes towards financial services providers and how they cater to older consumers, May 2017
                                                                                                                            • Only one in 10 think providers do enough to cater to older consumers
                                                                                                                              • 55-64-year-olds more likely to feel pressurised into managing their finances online
                                                                                                                                • Figure 30: Attitudes towards financial services providers and how they cater to older consumers, by age, May 2017
                                                                                                                            • Over-65s and Family Finances

                                                                                                                              • Role in family finances changes after age 75
                                                                                                                                • Gaining support for financial decisions
                                                                                                                                  • Figure 31: Attitudes towards finances and family, May 2017
                                                                                                                                • Receiving advice with family present offers reassurance
                                                                                                                                  • 55-74-year-olds relied upon for advice
                                                                                                                                    • Figure 32: Attitudes towards finances and family, by age, May 2017
                                                                                                                                • Appendix – Data Sources, Abbreviations and Supporting Information

                                                                                                                                    • Abbreviations
                                                                                                                                      • Consumer research methodology

                                                                                                                                      Companies Covered

                                                                                                                                      To learn more about the companies covered in this report please contact us.

                                                                                                                                      The Over-65s and Financial Services - UK - August 2017

                                                                                                                                      US $2,828.70 (Excl.Tax)