Rob Gardner says the industry needs to do much more to help engage the public with pensions.
The annual Pensions Awareness Day (PAD) took place last month. The pensions industry joined forces to help spread the message to the UK public about saving for retirement. But as an industry we need to find ways to keep PAD's message alive once the campaign's double decker bus has driven off for another year. We need to keep pensions front and centre over a sustained period to reinforce the valuable work campaigns such as this are doing.
How can we achieve this? Thinking about pensions over the long term, and thus boosting awareness of how they work, can give us the opportunity to view saving in real time. Identifying potential issues such as unexpected expenses or spikes in spending which make it hard to save at a given point. It also allows people to get into a habit of putting money away which, under supervision, can enable them to see the power of regular saving.
Ways to achieve this could include organising a tailored programme for employers and employees. Over time they could even extend it out to universities. This might include devising an effective communications strategy and having both timely and relevant contact in a format that savers can understand. For some this might be a letter, while for others it could be an email or even a text message.
Any programme should also include customised support. For instance, monthly teach-ins could improve savers' basic understanding of pensions. These might be educational sessions targeted at a range of life stages. They would unravel some of the mysteries of pensions, such as explaining what happens when you change jobs and need to update your pension. But they would also focus on driving engagement, by building an emotional connection with savers. Savers could learn about the magic of compound interest. Young savers in particular could learn about delaying gratification and putting away money early on.
Taking a long-term approach to pension planning could also help members engage with savings by making them fun. We could do challenges such as quizzes and competitions focused on improving understanding. If we make these challenges interactive, we could get people talking about pensions. We could give them a real insight into what goes on under the bonnet of their savings.
This will of course cost money. Companies will have to invest in their employees if they are to deliver an effective service. But a sustained and focused programme can present opportunities to those companies who are willing to embrace it. It offers them a chance to engage with customers. It lets them find out what matters and how they can improve their services to build a rewarding relationship for provider and saver.
If we are to improve the saving situation among UK savers, we are going to need a sustained approach.
Rob Gardner is co-founder of Redington
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