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Talking with self-employed people about retirement saving

Evidence type: Evaluation i

Description of the programme

According to figures from the Office for National Statistics (ONS), nearly five million people in the UK (about 15% of the working population) are in some form of self-employment, working either wholly or partly on a self-employed basis. This has increased significantly from 2001, when 3.3 million people in the UK were self-employed (12% of the working population). Interventions to encourage people to save for their retirement, such as auto-enrolment into pensions, have tended to focus mainly on those with an employer. It is estimated that only 14% of those who are self-employed are actively saving, compared to 88% of the working population who are eligible for auto-enrolment through their employer.

Since early 2019, Nest Insight has worked with the Department for Work and Pensions (DWP) on a research programme that explores and assesses different approaches to encouraging and enabling long-term saving among the self-employed.

The study

This report from NEST Insight and DWP summarises the findings from two email messaging trials that took place in the UK in 2019. These trials tested almost 20,000 self-employed people’s engagement with different retirement saving messages. DWP and NEST Insight partnered with the Association of Independent Professionals and the Self-Employed (IPSE) and Nest Corporation, two organisations that have a significant membership of self-employed people contactable by email to test retirement saving messages. The two organisations had some significant differences (particularly regarding income and gender composition), which the authors hypothesised would allow them to see how different types of self-employed people might respond to different messages.

In both of the trials individuals were selected at random to receive one of four messages by email:

  1. Palatable contributions - ‘could you contribute £2.50 a day?’ (Describing contributions as a daily rather than a monthly amount).
  2. Flexible contributions - ‘flexible pension options for the self-employed’ (emphasising that you can pay what you can, when you can).
  3. Tax relief – ‘a tax-free way to save for retirement’ (highlighting tax relief you can get on pension contributions).
  4. Loss frame – ‘don’t miss out on pension returns’ (framing the act of not saving into a pension as an opportunity cost).

Engagement with the trials was assessed by the number of people:

  1. Opening the email (‘open rates’);
  2. Clicking on a link in the email (‘click-through rates’);
  3. Engaging with related activities in the three months after the email.

Key findings

  • Open rates for all four messages across the two organisations were higher than for comparable email campaigns within the same organisations.
  • There were no significant differences in open rates or click-through rates by gender.
  • Older age groups were more likely to open the tax relief email, with a 56% open rate for those aged 50 and above compared to 45% for those aged 30-39.
  • In the IPSE trial, the tax relief email had the highest open rate of all four messages. In the NEST trial, there were no significant differences in the open rates between the messages.
  • In the NEST trial, a larger pension pot value was the strongest predictor of whether a self-employed member would open the email. Only the open rate for the palatable contributions message did not differ significantly with pot size.
  • Those who contributed regularly to a NEST pension had higher open rates across all four email messages, compared to those who had been contributing irregularly or not at all.
  • Regardless of how regularly a NEST member contributed to their pension, those with larger pots were more likely to open the email. The only exception was that a higher proportion of those who made irregular contributions into lower-value pots opened the palatable contributions email than those with higher-value pots.
  • Overall, the findings suggested that messages tailored specifically to the characteristics and needs of self-employed people have the potential to engage them in pension saving.
  • The development of these trials was postponed allowing further research that can increase understanding about the impacts of Covid-19 on self-employed people’s finances.
  • The authors also plan to explore the relevance of the messaging tested in these trials in a post Covid-19 environment.

Points to consider

  • Methodological strengths/weaknesses: The interventions were compared with similar campaigns from the organisations for benchmarking purposes.
  • Findings are tested for statistical significance, and the methodology used appears sound.
  • Generalisability/ transferability: The evaluation is of significant interest to those looking to commission or authorise interventions designed to promote retirement savings among self-employed people.
  • Relevance: The findings are based on members of two organisations representing self-employed people and should not necessarily be seen as representative of the entire self-employed sector of the economy (though given the numbers involved in the trials it is likely that the results are a fair indicator of retirement savings behaviour among self-employed people nationwide).

Key info

Activities and setting
Two email messaging field trials were conducted among almost 20,000 members from two organisations to assess if the interventions increased engagement.
Programme delivered by
Nest Insight; Department for Work and Pensions (DWP); Association of Independent Professionals and the Self-Employed (IPSE) and Nest Corporation.
Year of publication
United Kingdom
Contact information

Greg Bowe, Jo Phillips, Madeline Quinlan, Will Sandbrook and Gareth Turner

Nest Insight