Adopting a bottom-up approach could increase engagement with savers and help them obtain an income that would last their lifetime, according to a new report.

Published by the Institute and Faculty of Actuaries (IFoA) today, the report found that in order to do so, the focus should be on income goals rather than proportion of earnings contributed.
The IFoA also stressed the need to develop an effective communication strategy across regulators, the government and industry that is tailored to individual needs rather than a "one-size-fits-all approach".
In addition, the report called for tools for assessing savings such as a pensions dashboard and vehicles that combine flexibility and guarantee.
Gareth Connolly, chair of the IFoA Pensions Board, said this bottom-up approach should help people understand how close they are to achieving their objectives.
"It is crucial that people are able to plan properly for their retirement and understand what steps need to be taken to ensure an adequate retirement for their individual needs.
"Additionally, the risk of running out of money in retirement should be mitigated as much as possible to protect people from hardship or needing to fall back on the state for support," he said.
The IFoA also suggested introducing a rating system to help people understand how close they are to reaching their goals.
For instance, savers with a bronze rating are those able to meet all necessary outgoings.
A silver rating indicates those with enough money against unforeseen costs such as household repairs or long term care needs, while a gold rating denotes those with sufficient saving to afford additional non-essential items, such as being able to travel or leaving a bequest.
"Showing the tangible benefits of saving may help people to gain a better understanding of how the amount they save today will affect their lifestyle in retirement, and therefore, encourage people to take greater control so that they can meet their needs for the duration of their lifetime," said the IFoA.