This video is well worth watching, it shows Michelle Sutton , one of HR’s most charismatic communicators, explaining how she hopes the 11,000 members of the Aegon SUEZ workplace pension are going to get updated on how their savings are doing.
As it happens , most of them are doing very well as they are in a workplace pension that is delivering (through its default investment) well above the average returns savers can expect.
In three ways , the workplace pension has been hiding its light under a bushel.
- It should be attracting greater contributions per member for the value that it is giving for personal contributions
- It should be combining pension pots from previous workplace or private pension saving
- It should be offering staff nearing the end of their careers, retirement options known as investment pathways.
AgeWage, Aegon and SUEZ are working together to make this happen and we’re doing this via an app which tells staff what has happened (by way of returns) to their contributions , since they left their pay packet and how their and their employer’s contributions are building up to provide them with extra money in retirement.
Staff using the app will be able to input details of their various pension pots and see how each have done relative to their SUEZ workplace pension.
What is new is that the scoring system is created entirely from data that members have access to , but – till now – have never had analyzed. It seems amazing to me that people do not get information on how their savings have done but have to rely on generalized performance tables. By analyzing the individual contribution histories of every saving and comparing them with a benchmark, we can compare one pension pot with another in as way that helps people understand what they have and do something about turning pots into pensions.
Telling it as it is
Using real data means that not all the news will be good news. People who have selected their own funds may find they have done better or worse than the default. And people who have made one off contributions may find that the timing of their lump sum was awkward (regular contributions tend to spread the risk of investing on the wrong day).
But these things can be explained and where people recognize mistakes, mistakes can be rectified by fund switching or by managing extra contributions by payroll deduction.
We find that once people get interested in their pot and what makes it grow, they can get involved in other matters, such as what is happening to the money while it is in the hands of the pension provider and how they can turn this pot into a pension. But- and this was our big learning from being in the FCA innovation sandbox, people need to trust that they are getting real news about their pension pot and not the kind of fake news they associate with workplace pension marketing. They want the story of their workplace pension told as it is.
Real time news
You might think that we are jumping the gun and providing pension dashboards for SUEZ savers. But what we are doing is a pale imitation of what could be done if we were properly connected to the SUEZ provider (Aegon) and other pension providers.
Right now this service is not real time, people will see their scores based on the latest data we can get from providers and often it will take us weeks to get this information.
What the dashboard will do , will make requests real time , so we will be able to get data quicker and in a more relevant way.
In recent days I have been complaining that pension administration is lagging other areas of financial services and this is one of them. However, there is no reason why pensions cannot catch up and start delivering real time information that is clear , vivid and real.
For now, thank goodness we have progressive organizations like SUEZ and heroes of HR like Michelle Sutton.