Shout it out: why employers need to talk more about pensions
More than two-third (67%) of employers feel they aren’t doing enough to support financial wellbeing and pensions through communication, according to Aon’s Benefits and Trends Survey.
As people start to consider their health, wealth and self, employers can be a big part of helping employees to plan for a financially secure future.
Pensions might not be the most captivating subject.
Each employee is different. From financially savvy Boomers to Generation Z, opinions differ on how to handle money. Some will have built a nest egg, while in a world where the pound continues to struggle, some may be happy to spend their hard-earned cash on living for today.
That’s all well and good, but saving for the future will ensure a comfortable retirement. So, how do you begin that education process?
Start with the basic fundamentals of a workplace pension and communicate them in an effective manner.
An expert’s guide
Under the Pensions Act 2008, every UK employer must enter eligible staff into a workplace pension and pay into it. Auto-enrolment was also introduced in April 2012, requiring every employer to automatically enter every eligible employee into the company pension plan at the minimum level, offering the chance to opt out if they wish.
Zest’s benefit’s expert, Joy Waugh, feels it’s vital that employers do more to raise the profile of pensions and auto-enrolment.
“Employers can do an awful lot more to raise awareness.
“There needs to be a programme of communicating what benefits you offer, especially your pension. This can be prior to that person joining the company, or shortly after they start. Have you gone out of your way to inform everyone that they’ll be automatically enrolled into your scheme if they meet the minimum requirements?
“Yes, it’s an easy way for them to put money aside, but they might not be aware of how things work. Why it’s a legal requirement for them to be enrolled and how they can opt out should they wish.
“You need to communicate everything that will happen. The contributions you provide, what investment funds their savings will use. There’s a huge amount of interest in ethically sustainable funds at the moment.
“Remember, if you provide more than the legal minimum contribution of 3%, then why wouldn’t you want to shout about that. It’s a brilliant incentive. If an employer takes this approach, then this is a great endorsement of why you should go and work for them.”
To find out how Zest’s employee benefit technology can help support your pension offering, click here.
Download Aon’s Aon’s Benefits and Trends Survey here.
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