Carol Hosey: How Mitie helps its employees think about retirement

If you work within the field of reward then you know the importance of pensions as part of the overall remuneration package.

Getting people to think about what their pension requirements are, however, has proved a difficult task for most people. Let’s face it most people glaze over as soon you mention the word or suddenly have another meeting to go to, which doesn’t do much for your ego! And the changes implemented by the government over the last few years (with more to come) have done little to help.

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Within Mitie we are starting to take a slightly different approach to the topic by looking at retirement planning and getting people to think today about how they want to live their lives when they finally make the shift from the workplace.

We start with a few simple questions:

How old are you today?
How old will you be when you plan to retire?
How long do you think you will be in retirement?

This starts to give people an idea of how long they will live without having a regular income from a job.

Next we get on to planning a regular budget. There are lots of examples out there that you can use and those provided by the Money Advice Service or the Citizens Advice Bureau are as good a place to start as any. They get people to think about things such as:

What will the regular bills be (mortgage, loans, utilities, insurances, phones, Sky, car maintenance and so on).
How will you spend your leisure time (eating out, takeaways, coffee, cinema, holidays, hobbies and so on).
What income will you have available to you (pension, savings, shares, ISAs and so on), all of which may be subject to tax deductions!

And this is when it gets interesting. People see what they will need to spend to live the life they want to lead in retirement relative to the funds they will have available to spend. If you are in the aspirational population that wants to retire at 55, the realisation that you may need to pay for 30 years of retirement according to the current mortality rates, can be quite an eye opener.

The aim in this new approach has been to make people more aware of what the future holds for them and take a practical view of what they need to do for themselves to achieve it. We can’t give advice but we can provide information and education for people to help them better understand the issues and start the journey to taking ownership for the future.

This article is written by Carol Hosey, group reward director at Mitie