Pension communications – time to talk better?

Communicating effectively  with employees is a key part of the HR role, yet even the CIPD acknowledge that employees often feel they get limited or no communication.  In some areas of HR, it’s harder than others to obtain engagement.

Pensions communications is an area where employee engagement is typically low, however a new research report  ‘It’s Time to Change’ from Punter Southall Aspire offers UK companies fresh insight into how HR, pensions and benefits professionals can transform and optimise their pensions communications.

In compiling the report, over 2000 working people aged 16 – 65+ from across the UK were surveyed by the company, and the team were able to identify four major issues affecting pensions savings:

  • Pensions aren’t a priority for everyone because ‘now matters more than then’
  • People are anxious about their financial future but are not actively managing it.
  • Apathy about pensions is widespread and people are not making active pension decisions.
  • Respondents want and need better pension communications from their employer.

Addressing these issues is key to better engagement on pensions.

Now matters more than then

The research found that people are more concerned with their current finances than looking to the future. The reason for this is many have competing financial pressures. Half are paying off a loan or credit card, 30% regularly use an overdraft facility and 45% have dependants to support financially.

 The need for instant gratification also plays a part. 88% would rather have £400 now over the chance of £800 in the future and 66% claimed they would be more likely to respond to communications that referred to ‘now’ rather than the future. 

 Johanna Nelson, Associate Director, Punter Southall Aspire said,

“From a communications perspective, employers can tackle these issues and increase pension awareness with a constant ‘savings drumbeat’ – using regular positive messages that encourage better savings behaviour.

 “People are more concerned with now rather than then, so companies can tap into this by providing financial education on issues that concern them such as debt management or budgeting. The positive benefits of pensions and auto-enrolment can be introduced as part of this conversation.”

 People fear for the future but aren’t taking any action

People are also burying their heads in the sand about retirement. Nearly half (46%) say their biggest fear for the future is not having enough money in retirement, but almost a third (30%) admitted retirement isn’t part of their current financial planning. 66% said they don’t know if they are saving enough for retirement. One reason for this is that 78% of people are on short -term budgets – budgeting monthly rather than looking further ahead and only 28% claim they stick to their budgets.

Apathy is widespread

People are also apathetic about pensions. Nearly one in five of those aged 16 to 24 had no idea if they have a pension and 30% said they don’t think pensions are important. Almost a third (32%) couldn’t remember their contribution rate and claimed it was the amount the employer set as the default. Another reason for this widespread apathy could be the fact that three quarters say they are optimists and believe their retirement will be fine, despite their inaction.

So how should companies respond?

A key finding of the report is that employers need to do more to guide and support their workforce. 82% want their employers to guide them in a positive direction about pensions and 72% want them to educate them about planning for the future. 68% want their employer to keep reminding them to review their pension and take action if necessary even if they don’t respond to their communications.

 The research also found that traditional communication tactics are in need of an overhaul. Only 38% said they will respond to scare tactics that are so often used in pensions communications. Instead, three quarters (76%) would react to exciting messages, highlighting the need for companies to use positive and relevant messaging and emphasise the benefits of saving more. The research also highlighted that the best ways to capture people’s attention with marketing and communications materials are with ‘powerful imagery’, ‘humour’, ‘moving words’ and ‘colour’.

 Johanna Nelson, Associate Director of Communications says,

“There is a real need for employers to improve their pensions communications and this means getting proactive and stop relying on the material produced by pension providers. Arguably employers have a duty of care to help ensure employees have a positive retirement and are in a strong position to make this happen.

 “Employees want financial education and guidance on current and future financial issues and by promoting positive communications and financial education they can encourage a savings culture. To support this, companies can use technology and tools such as MyAspire, our online financial dashboard, to help employees work towards reducing financial anxiety and improving their financial wellbeing as well as building their interest in and engagement with savings.”

Punter Southall Aspire has also devised a 7-Step Strategy Model for optimised communications. This is a bespoke communications strategy led by a client’s objectives to improve their pension communication.

Johanna Nelson concludes,

“Our approach can help employers play a significant role in guiding, communicating and supporting their employees with their workplace pension savings. We encourage employers to get in touch and speak to us about how we can help optimise their pension communications.”


About Punter Southall Aspire

Punter Southall Aspire is a major investment and savings business that blends a strong customer focused heritage with a modern and technology-led outlook.

Uniting pensions consultancy, workplace savings and individual financial advice, we work with employers, trustees and private clients through our 10 regional UK offices to design and manage solutions that meet their unique needs.

Punter Southall Aspire is part of the Punter Southall Group, which is proudly independent and majority employee-owned.

Punter Southall Aspire has[i]:

  • Number of schemes: c.1,250
  • Assets under Advice: c. £4 billion
  • Number of members: c.200,000
  • Number of employees: 100
  • Private clients c.1,200