From April 2015 the pensions landscape in the UK is radically changing and with less than 50 days to go, is the industry ready asks Karen Heath?

The new changes, said to be “the most radical changes to pension in almost a century”, are causing a stir in the industry. With a year’s prior warning, we are still seeing a sudden rush of panic, as companies leave it until the last minute to communicate to their members. In an industry that fully appreciates the reward of preparation and planning, why are we so deadline reactive?

With increasing uncertainty amongst members, it’s crucial that clear communication is being sent out. Those closest to retirement are likely to be more conscious of the impending changes, especially those due to retire in 2015, but what about the average member?

We need to ask ourselves what would be helpful to the member, because the member does need help.



7 out of 10* companies have not communicated the changes to their members, therefore it’s clear as to why there is rising uncertainty. It’s easy for us ‘in the know’ to be dismissive - “We can’t really say anything because we don’t yet know how we’re going to deal with this or what products will be available by April”, but this isn’t really helpful to a member who is considering their options.

Evidence points to the effectiveness of modelling tools”

Some may have heard of the pension freedoms that the Government have promised, which offer increased flexibility, including options to take their pensions as cash, tax paid, or their cash-free 25% in several tranches, options to drawdown and convert DB to DC pots, but it’s not guaranteed that all members understand how this affects their individual circumstance.

Members need to hear from you sooner rather than later. They want to know how they are impacted by 2014 Budget and what they should do. Even if we still don’t have all the answers, members want to know someone is looking out for them. We’ve been doing this with many of our clients already, but sadly it isn’t the norm.

It’s the start of a new way of thinking about pensions and retirement”

Evidence points to the effectiveness of modelling tools in engaging the member with potential pensions outcomes. Websites with an inbuilt modeller receive a much greater visit rate, than those without.** The simple relationship between the pre-retirement levers members can pull is empowering – understanding the combined effect of contributing more, retiring earlier or later and investment returns is a good first step in planning the retirement pot target.

As we engage and guide members through the impact of these changes, communication should be emphasising the importance of retirement planning for improved lifestyle outcomes.

We need to remember that it’s not just about April 2015, it’s the start of a new way of thinking about pensions and retirement.

Your engagement strategy needs to go beyond April, whether it’s a website, modellers or leaflets, communication needs to be continuously engaging. How we communicate these changes can help make a great, long-term difference to the lives members lead in retirement.

Karen Heath, head of engagement, AHC