As our Pensions Week draws to a close, it is time to reflect on some of the trends and issues currently shaping this area of the benefits market.
A pension is arguably one of the most important benefits in an organisation’s package. Yet, despite representing the largest proportion of an employer’s benefits spend, ensuring staff maximise and value the scheme is not always straightforward.
It is well documented that many are still not saving enough for retirement, and pensions do not always enjoy the reputation they deserve. More pressing financial needs and, in many cases, the length of time before an employee reaches retirement, mean that all too often people do not appreciate the value of a good pension scheme until they draw closer to retirement. By this stage, it is often too late to rectify any shortfall and achieve the pension pot needed for their desired standard of living in retirement.
Auto-enrolment has gone a long way towards increasing the number of individuals saving into a workplace pension in the UK; however, the very nature of the legislation has also created issues. By setting minimum contribution rates, the government has unintentionally created the belief that these figures represent the mythical number that will result in a sufficient level of retirement income.
How to overcome the resulting apathy and encourage employees to take a more proactive approach to setting higher pension contributions is currently a significant challenge for employers.
A key method of presenting pensions as relevant to all employees, regardless of their life stage and personal circumstances, is to ensure schemes are fully integrated within the broader reward package.
Clearly positioning pensions alongside other benefits, such as group income protection, will writing, and private medical insurance, to name a few, can aid employees’ financial planning in the short, medium and long term, particularly when supported by a comprehensive, targeted communications strategy.
Whatever your workforce’s retirement needs, Pensions Week was designed to help you take this to the next level through exclusive insights and opinions uncovering best practice in this area. These included:
- Helen Ball: What does the future hold for defined contribution pension schemes?
- What do employers need to know about the GMP equalisation process?
- Infographic: Key dates surrounding GMP equalisation
- How to help employees overcome auto-enrolment apathy
- DWF engages employees with pensions through enhanced matched contributions
- Mel Duffield: Initiatives to engage younger employees with pensions
- How to align pensions provisions with a wider benefits strategy
- Nationwide demonstrates the role of workplace pensions within wider package
- Phil Spary: Testing times for master trust pension schemes