What if someone told you that compared to ‘the Joneses’, you’re saving about 20% less for retirement each month.
Chances are, that information would be impactful. You’d probably feel the necessity to relook your money management to try and put in a little bit more each month. That’s the potential power of big data in the retirement funding space to catalyse meaningful interventions at the right time using impactful insights.
These kinds of data driven interventions are essential as the Sanlam Benchmark Research shows just most employed South Africans will not be able to maintain their standard of living into retirement.
Johan Prinsloo, CEO of Retirement Fund Administration at Sanlam, says it’s a moot point that members don’t save enough. “We also know that HR practitioners and retirement fund administrators accumulate vast amounts of data. We need to start responsibly using this to see who is at risk and how we can intelligently intervene. Like for like comparisons between people in similar profile groups could be a mechanism to influence individuals to review their choices. Having a peer-based benchmark allows individuals to assess whether they are themselves at risk and to implement appropriate course correction.”
Prinsloo says that Sanlam Corporate is pioneering a first-of-its-kind big data project focused on how to address ‘retirement resilience’ by improving Net Replacement Ratio outcomes. “Customer expectations have shifted. Our clients expect us to offer them a bionic user experience that integrates the best of machine learning with considered human interaction to optimise member outcomes. That’s exactly what we’re aiming to do by presenting insights in formats employers and trustees can easily understand and implement.”