Feeling excluded?

[Margaret Ford] We’re often told that 70 is the new 60, 60 is the new 50 and so on.  In reality, the speed of technical change can have a real impact as we grow older. Take the proposed abolition of cheques – to the young it was a no-brainer. To some older people it was another sign of technology passing them by and making their lives harder not easier. In this case, the change was defeated (although for how long?) but in many areas technological change is causing significant problems for older people. It’s not all bleak though, as I was to discover at a recent round table event on older people and finance organised by the CSFI. 

The panel included Prof. Andrew Monk (University of York), Dr. Verina Waights (Open University),Rowena Crawford (IFS), Keith Gold and Mervyn Kohler (Age UK)*. The two central discussion points were ‘which products are most suitable for older people’ and ‘how we can make them most usable’. The discussions started with context setting, including the interaction between private and state income. In particular, the Department of Work and Pensions estimates that between 1.25m and 1.5m eligible pensioners do not claim pension credit. The public perception is often that pension planning is completed prior to retirement, from which point their situation will remain largely unchanged. 

However, potential future shocks such as the cost of long term social care and life events such as retirement, bereavement, late divorce and downsizing, all highlight the need to save even into later life. Declining interest rates for savers can dramatically cut incomes. In addition, people tend to underestimate their life expectancy (by 2 years if male, 4 years if female). Before retirement, financial planning is normally focused around accumulation, whereas beyond retirement decumulation can be a focus. An important decision is the extent to which wealth is to be used for spending or legacy. 

There is also no clarity over the definition of older people, which in the EU tends to mean people aged 55+. However, with the retirement age getting progressively higher, this may become less meaningful. In a research environment, older people may self-identify e.g. some people in their 90s may not feel that they belong to this category, while a grandmother in her 40s does. Nevertheless, a number of issues are relevant: individuals who may have relied on their partner to manage money throughout their lives together, suddenly find themselves bereaved and having to master a new and complex skill. Equally, the role of the Internet in offering the best deals on financial products risks disadvantaging non-users – while the stereotype of the ‘silver surfer’ is based in fact, not all older people are confident users of technology.  

As regards technology penetration, possession of a device does not imply successful access to the services available via that device. For example a study by the OU found that many smartphone users do not use their phones to access the Internet: 30% showed a high level of use, 30% would use it but not for purchases, 30-40% were not accessing the Internet in any meaningful way. Trust is a major factor in promoting engagement, as is personal affluence in influencing the purchase of technology. However, public access provision e.g. in libraries and Age UK centres is now widespread, so people on low incomes are not necessarily excluded. 

Most older people who do access the Internet do so via a laptop or PC, although Digital TV is seen as important in promoting digital inclusion and enabling people to benefit from ‘online-only’ deals.

Older people are more likely to opt out of e-banking and e-shopping, partly due to fears fuelled by media stories. Ease of use is also important, and technology updates can cause people to drop out. As regards usability, inclusive design aims to understand the ways in which people are excluded, resulting in solutions which can benefit the wider population. One example of this is audio books. 

In the older old (80+), many of whom were growing up during the war, there is an interesting approach to money, with many being very careful in their management. Record keeping (for instance in the form of cheque stubs) is a priority – in other words, for cheque users, the stubs are as important as the cheques. If technology is to be introduced to replace familiar forms of payment, usability is a key factor and that means including a means of record keeping. 

Another pressing issue, identified in a report written by Policis/Toynbee-Hall on behalf of the Payments Council in 2012, is the need to delegate payments. The use of a helper card has a clear role to play here, preferably with safeguards to ensure that the person using the helper card has only limited and time-specific access to the account owner’s funds. Payments systems, which aim to be universal, must take into account the natural impairments of ageing, particularly affecting vision, hearing and dexterity.  Dementia is also very prevalent, with implications for all aspects of life, including finance. 

The practical, human processes around card and online technology are not yet sufficiently robust. Issues with PINs tend to result in accounts being frozen, requiring the account holder to attend the branch with identity documents. In many cases the account holder is not mobile enough to be able to attend the branch easily and if they are, they may no longer have the necessary document (passport, driver’s licence). Independence and safety are the key areas of focus for delivering effective services in this area. It was proposed that cards and PINs are fundamentally problematic and that identity lies at the heart of the problem. A biometric solution might help, perhaps voice via a simple appliance like an iPad. Equally, a fingerprint-based PIN reminder has been developed in collaboration with older people and found to be very popular. 

Proposals for ways in which the industry can provide for the needs of older people included investigating the role of the Post Office as a trusted partner and identifying ways in which other organisations, perhaps Saga or Co-op, can play a similar role. The need for advice and the complexities of paying for that advice were highlighted. The Care and Support Bill currently going through parliament will require a new kind of adviser, with a wider range of skills than many existing financial advisers. The Society for Later Life Advisers may have a role to play here. 

At the lower end of the income scale people tend to receive a very poor service, especially regarding investment. Intelligent systems could help to direct people towards appropriate advice. These systems would need to be created by people who understand the issues, with services delivered more widely through the use of automation. The immense issues facing people on low incomes, whatever their age, were highlighted. In particular the introduction of Universal Credit is likely to result in many claimants requiring significant levels of support. The first priorities must be the provision of benefits and tax advice, since paid advice may not be a realistic option.

All in all, the discussions generated a high level of interest and the group agreed that the subject will be revisited on an ongoing basis. One resulting priority is to gather the relevant data, to provide a firm basis for future discussions.

* Andrew Monk is Emeritus Professor of Psychology at the University of York. His main interest is how to ensure the continued independence of older people in an increasingly technological world.

Verina Waights is a lecturer in Professional Health Care Education at the Open University, with an interest in the discrimination people with long-term conditions often face due to their advanced age.

Rowena Crawford is a senior research economist in the pensions and public finance sector at the Institute of Fiscal Studies. Her focus is on pensions and saving for retirement.

Keith Gold spent over 30 years with IBM, focussing on the application of technology in the financial services industry. He is a self-declared ‘tech-savvy wrinkly’.

Mervyn Kohler is Special Adviser at Age UK, having been Head of Public Affairs at Help the Aged (before it merged with Age Concern). He also serves on the Social Protection Expert Group of Age Platform Europe. 

These are personal opinions and should not be misunderstood as representing the opinions of 

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