In this 2 minutes with segment, we grill Katharine Photiou, Head of Workplace Savings, Product and Proposition at Legal and General Investment Management and a panellist at the recent MRM event on the role of the workplace in closing the savings gap.
You recently took part in a debate hosted by MRM (which has just been launched as a report). What aspects of the debate did you find most thought-provoking?
The debate on the need to create a safe harbour for employers to promote pensions and wider savings was the most interesting and thought provoking. Until employers receive this some of them will continue to be somewhat guarded on how they promote and inform their employees about saving. This is such a shame as the workplace can be the ideal place for encouraging savings.
During the debate, you made an interesting point about how reducing the savings gap can have a positive impact on the wellbeing of the population. Can you expand on this further?
There are five elements to positive wellbeing:
- Career wellbeing: how you occupy your time or simply liking what you do every day
- Social wellbeing: having strong relationships and love in your life
- Physical wellbeing: having good health and enough energy to get things done on a daily basis
- Community wellbeing: the sense of engagement you have with the area where you live
- Financial wellbeing: effectively managing your economic life
The research I have conducted shows that financial wellbeing is not determined by how much you earn or spend but by the size of your savings buffer. This is the amount of money you have saved that you could use if your income stopped overnight (due to eg redundancy, sickness etc). The bigger the buffer the more individuals feel a sense of financial wellbeing.
If the savings gap in the UK reduced because all of us were saving more we would all feel an enhanced positive wellbeing.
Much has been made of the fact that no one organisation has overall responsibility for ensuring that pension scheme members are as well informed as possible. Who do you think should be responsible for this (ie should it be providers, the Government or even individuals)?
All of these parties have a role to play. Providers need to speak in a language that members understand – clear and transparent. The Government needs to ensure regulation does not result in confusion for members. Pensions simplification should mean pensions simplification! The individual needs to take responsibility for engaging, reading and questioning what they don’t understand. Furthermore, the employer has a role they can play in facilitating provider and adviser communication sessions with members.
Can you tell us about your role at LGIM?
I am Head of Workplace Savings – Product & Proposition. My team deliver integrated product strategy, development and management for our DC workplace savings business. I love the company – it is so vibrant and full of talent. The workplace savings business is no exception.
If you could change one thing about the financial services industry, what would it be?
I would give us all the benefit of hindsight as you often need it in this industry.
What is your biggest pet peeve, or makes you angry?
Any kind of cruelty to animals and discrimination – age, race or gender.
Now, tell us a little about your life outside of work, do you have any hobbies?
I am married and have a beautiful pet parrot called Millie. I love travelling, reading, going to the theatre, good food and company!
What is the one column or website that you read every day?
I am afraid to say I love the Daily Mail. I don’t agree with their views but I do love the gossip and Kardashian news!
What would you do if you were Prime Minister for a day?
Ban vivisection on animals, make animal cruelty illegal and punishable by prison, and create better distribution of wealth. Ban Donald Trump from being allowed to come to the UK, reverse the Brexit vote and give every homeless person a job so they can be self-sufficient.