Abrdn has launched a new manifesto in a bid to “get Britain investing”.
It comes after research from the company revealed that only a sixth (16%) of UK adults favour pensions over property as an investment.
Abrdn’s research also showed only 19% hold shares outside of their pension and out of that figure, four in ten do not hold them in an Isa.
The most common ways people save and invest is through current accounts (75%) and cash saving (72%).
When people do invest, they are more likely to do so directly into individual shares rather than funds (19% vs 11%).
Abrdn’s manifesto, ‘The Savings Ladder: A Manifesto to Get Britain Investing’ was published today (19 February) in response to the growing savings crisis and has been welcomed by the London Stock Exchange (LSE).
The manifesto recommends the government’s advertising campaign around the NatWest share sale should be broadened to include tax-efficient investing.
In addition, Abrdn also believes Isa simplification should be implemented – something AJ Bell has been campaigning for too.
It added stamp duty on UK shares and investment trusts should be scrapped and there should be a “radical reimaging” of what minimum pension contributions should look like.
Finally, it emphasised the need for UK financial literacy levels to be improved, paving the way for better long-term outcomes and also a shake-up of financial education in schools.
Abrdn chief executive Stephen Bird said: “With pressure on how far governments can go to support an ageing population, retirement pots will increasingly fall far short of what people need and deserve. The NatWest share sale could be a once-in-a-generation opportunity for the government to start a broader campaign.
“Just as the ‘property ladder’ concept has crept into cultural consciousness, we need to develop the same enthusiasm for a ‘Savings Ladder’ where people can see the benefits of starting early, building their pot and investing to grow it. Minimum contributions into defined contribution pensions still need to radically increase and ideally double. That’s not easy, but nor is an ever-increasing state-pension age.
“As an asset manager with a significant footprint in the retail and adviser investment-platform space, it’s certainly in our interest to see more people plan, save and invest for the future. But it’s also a critical challenge for our society. Getting on the Savings Ladder would be good news for everyone.”
LSE CEO Julia Hoggett added: “The development of a greater saving and investing culture in the UK, and having more straightforward ways to save and invest, are critical to people up and down this country securing the futures they want for themselves and their families.
“Ensuring that the UK has the right frameworks and products to provide savers with the returns that meet their needs and companies across the country with the funds they need to grow (and in turn to employ those same savers and their families) is a critical project.
“I welcome Abrdn’s report, which shines a straightforward light on a problem statement and solution that can seem complex, but in its intent is both simple and essential.”
To obtain these results, Abrdn commissioned Opinium Research to survey 2,000 UK adults.