Member engagement has many champions, but they are often not chanting together. Many voices, many messages, and some self-interest thrown in, all contribute to member confusion. Engagement is sometimes the poorer cousin in the industry, but its impacts will ripple for decades to come as it’s directly correlated to adequacy. As pension confusion increases, so too does disengagement, apathy, and inaction, all resulting in poorer retirement outcomes.
Shared responsibilities/Shared failings
Administrators, pension providers, and trustees all have a shared responsibility in member engagement, but this is sometimes, and understandably, self-centred. We are really only interested in our own fund, our projections, and our documents, but for the member, this is most likely just one piece of their ever-growing retirement jigsaw. Your statement might be their current fund, but they have a trail of other pensions from their career hopping over the years. Some with advisers, some direct, possibly some overseas benefits and maybe even some have slipped into that ever-growing bucket of unclaimed pensions.
As an industry, we like to think that members are like us. They have all their pensions on a spreadsheet showing the moving averages of performance and a graph that updates each time they insert a new value. We like to think that they meticulously study every page of our well-crafted Benefit Statements when in reality, it’s more like a cursory look, probably some negative comments under their breath and then it takes its rightful place in the box under the bed with all the others. Gone for another year.
At the coalface
The glue to bring all their pieces together is often the pension adviser, who is very much at the coalface of member engagement. But advisers have their own engagement challenges and to fully understand all aspects we need to look at every member touchpoint down the chain.
Far away from the lofty boardrooms where the topics of governance and compliance are pondered, the independent adviser is in the cold canteen of a furniture maker in Athlone, talking with the handful of members that turned up for the renewal presentation. This is where engagement begins.
Individual clients diligently choose a financial adviser to manage their affairs, but scheme members don’t get this privilege, they are allocated an adviser by their employer, often making for a weak relationship from the outset.
The on-site group pension engagement model all centres around the customary renewal meeting when the adviser, in age-old tradition, visits the company with the somewhat out-of-date Benefit Statements and gets an allocated time with the members to chat about their pension. Other than that, members are provided with a login to yet another pension provider, which ironically only adds to further diluting the relationship with the adviser.
This is the time when members need clarity and an overview of all their pensions, more than just their current fund. What does my complete jigsaw look like? But for many reasons, the adviser cannot always provide that level of detail. Maybe the adviser is tied to a particular insurer/fund, or they are not the agent for the other pensions, or maybe they are overseas pensions from a region where the adviser has little experience, or quite simply, there is not enough time allocated at the renewal to cover that level of detail with so many members.
Australian experience
Whilst the Australian superannuation market has developed into a multi-trillion-dollar industry since the introduction of compulsory superannuation back in 1991, it is the simplicity of the system that has kept member engagement strong. The two lessons we could learn from the Australian model are the simplicity of the rollover system, where benefits can easily be consolidated regardless of what type of employment they originated from, and secondly, how easy it is to search for old pension records. The Australian Tax Office (ATO) keeps all pension records under each individual’s tax number so a simple call to the tax office will ensure members have accounted for all their deferred pensions.
Ireland’s layers of pensions legislation over the years have built a complex set of rules as to what members can and cannot do with their benefits depending on the type of pension and type of employment it originated from, which has only added to member confusion.
The power of visualisation
Studies have shown that over 68% of the world’s population are visual learners. People who comprehend and learn from visual imagery. You will often notice when you see a detailed report, your eyes instinctively go to the diagram or graphic first so that our brains can get a conceptual overview of what we are looking at. We do it ourselves when we are working on a problem or complicated concept, we need to draw a diagram or whiteboard it. This is what scheme members need to put clarity on their pension jigsaw, a simple visual overview of all their benefits to help them see their future in a single view. The concept of the pension dashboard is becoming increasingly common across Europe and the UK Government is far advanced on the UK version.
The dashboard makes multiple pensions more tangible. It is simply the power of visualisation. As simple as a list of all a member’s pensions, providers, and values in one place creates a sense of containment to what was once random. Like at the start of a busy day and we make a list, whilst nothing has yet been achieved, we have ring-fenced the chaos, taken control, and are ready to take action.
Pension dashboard challenges
The development of the Pensions Dashboard Programme (PDP) in the UK was by no means smooth and it is yet to get off the ground, so the possibility of a fully integrated Irish version seems very far down the road. Way back when Johnny Logan was still in the charts, Charlie McCreevy first muted the concept of auto-enrolment, and we have yet to see that come into force. So, it’s probably safe to say that every reader of this article will be well retired by the time the Irish Government gets around to an Irish version.
Secondly, and probably more importantly, the pension providers have no real interest in a pension dashboard for the collective good. They want their clients to look at their brand. They want website hits and as many customer touchpoints throughout the year as possible, not to be a single row of data among many other providers on a member’s dashboard. The UK Government even had to include provisions in legislation to compel providers to be ready to connect to the digital architecture and be ready to receive digital requests.
PensionsVault
PensionsVault is an independent pensions platform providing scheme members with self-service facilities to manage all their pensions in one place and for advisers and/or administrators to digitally connect with members, boosting communications and engagement.
For the scheme member, PensionsVault offers a secure desktop solution to view details of the current scheme, which can be uploaded by their adviser or administrator, and a digital vault to replace the box of statements under the bed, to help them see their future in a single view.
The self-service facilities allow members to log records they have about their old pensions, even overseas benefits. It is a frictionless experience, so they don’t need policy numbers, references, or exact current values, they can input the details they can recall and start to get a helicopter view of their retirement jigsaw along with storing documents and use interactive simulators to see what retirement might look like.
Marketing gold
Once members are registered on PensionsVault it becomes marketing gold for the adviser/fund. Multi-scheme marketing, assigning member tasks, and auto campaigns can all be implemented at the toggle of a button, creating year-round touchpoints, building engagement, and marketing opportunities.
Members that leave the scheme maintain lifetime access to their Vault, keeping the scheme in touch with the deferred members and providing members with the consistency of the same platform and adviser wherever their career takes them.
Engagement partner
PensionsVault, owned by Centric Pensions Ltd, is a dedicated engagement partner for advisers and funds. In addition to the branded member software, each adviser/fund is assigned a dedicated Scheme Engagement Manager, responsible for scheme setup, uploads, and working with the adviser/fund to build and implement a digital engagement calendar, ensuring year-round focused communication without the cost and administration. We call it hands-free engagement.
For more information contact Karl O Meara at karl@centric.ie