How to engage with pension scheme members
As Pension Awareness Day takes place across the country, Like Minds has created a checklist for good communication.
The UK faces many challenges with pensions following an uncertain future for the state pension, dominating defined benefit (DB) headlines, and concerns people are not saving enough for retirement.
In aid of the third annual Pension Awareness Day, the Like Minds team have put together a list of top 10 ways to engage members in their pensions:
1. Make your message interesting – inspiring, even
Everyone knows that pension information is a turn-off. Learn to make your message content an interesting and worthwhile read. Where possible, give real-life examples and sell the positive benefits of saving. Be adventurous, even – surprise your audience with humour, a novel headline, a quirky cartoon.
2. Play the “missing out” card
Appreciate the power of “loss aversion” – the human condition that hates losing out, even when faced with something we didn’t even want. Advertisers use this with great effect with the prospect of missed deadlines and bargains. Missing out on each year of employer benefit contributions, or the missed opportunity to retire at a decent age can be effective messages.
3. Don’t overwhelm
No-one wants to be bombarded with information that is of little interest. Having to wade through a deluge of pension details is tedious and confusing – and gets in the way of decisions.
4. Be relevant
Personalise your communications and use different life stages to prompt calls for additional contributions or investment decisions. Ensure your language is appropriate for your audience: though you may have some experienced investors in your membership, most will want a simple explanation of what the investment is trying to do rather than a detailed breakdown of the fund’s asset allocation.
5. Be adventurous with communication channels
Most member communication is still through paper – letters and newsletters. To stimulate greater engagement, use a range of different channels. Videos, posters, micro-sites, social media and, of course, face to face sessions, can be much more powerful in getting the message through.
6. Use clear and simple language
Banish jargon and talk in members’ language – using short sentences and a conversational tone are helpful. Weed out all technical terms; you might even banish the word “pension”, a turn-off for most. A good tip is to get your teenage son or daughter to test read your draft and get their reaction.
7. Give support
Where possible, support employees with interactive modelling tools and guidance on the options available, or offer individual financial advice if that is affordable. One of the biggest issues in the DC pension world is members’ lack of financial knowledge and confidence to make good savings and investment decisions.
8. Make the savings process easy
Use smart defaults and automation to streamline the decision-making and form-filling process. Minimise the effort involved with any applications – people want an easy life, and a complicated or long-winded process will quickly be aborted.
9. Provide reassurance
We live in a world where social media and product reviews provide reassurance of our spending decisions. Treat pensions in the same way if you can. Bring in case study examples of members who have taken pension decisions and lived to tell a positive tale. Forecasts of prospective retirement income and other evidence from third-party sources can also provide reassurance.
10. Consider the bigger picture – financial wellness
Research shows that organisations that help members with their immediate financial challenges can build trusting relationships for the future. This includes making decent savings for retirement and the longer term once these are affordable.