Auto enrolment’s been hailed a success with over nine million people now enrolled in a workplace pension scheme. However, insights from the recently published Office for National Statistics’ (ONS) Wealth and Assets survey show much more needs to be done if we’re to crack the retirement saving challenge. Figures point to a huge lack of awareness around auto enrolment and pension saving in general. So here we’ll take a look at the importance of communicating to your employees the benefits of saving into your scheme.
According to the figures:
Only 63% of eligible employees were aware they had been auto enrolled into a workplace pension.
Of those employees who said they had not been auto enrolled, 91% of then actually had.
Only 42% of non-retired respondents said they knew enough about pensions to make decisions around saving for retirement.
Providing a pension for employees is a powerful benefit, but if they don’t understand it, or even know they’re part of a pension scheme, then there’s a real risk they won’t be able to adequately prepare for retirement. Helping your employees understand their pensions will help them feel secure and put appropriate plans in place.
Our workplace pension proposition comes packed with ways to help you to engage with your employees and help them to understand what saving into a pension plan may mean for them.
Communicating with employees will help them understand how pension tax relief, employer contributions and appropriate investment strategies can boost the amount being saved into a pension over time. We’re committed to helping your employees understand their retirement savings by using clear, simple and jargon free language.
To make it even easier for your employees to stay in touch with their pension savings, we’re developing a mobile app. The app will be available on iOS and Android, and will initially allow your employees to clearly see key information such as:
All of this aimed at increasing engagement with their pension. Having this information in one place highlights the value that you add to their savings and helps show that as an employer you’re doing the right thing for their retirement. Your employees can also use the app to contact us with any questions they have.
We’ll keep you up to date on the app’s launch and how your employees can be one of the first to use it.
In addition, as auto enrolment minimum contribution levels go up over time, members will need to understand that they’ll need to save much more than these minimum levels if they want to generate a big enough pension to give them a decent income in retirement.
So while auto enrolment has done a fantastic job so far in getting more people saving into a pension this is only the first step and it’s well worth investing in a communications programme to help members understand what they have.
You might find it helpful to speak to a financial adviser about your communication plans and how to remind your employees of the value of their plans and of your investment in them. If you don’t already have a financial adviser, you can find one in your area by visiting unbiased.co.uk. Advisers may charge for their services - though they should agree any fees with you upfront.