Auto-enrolment appears to take the pressure off pensions communication. If employees don’t have to choose to join and if their contribution levels are set, we can pack up our jargon-busters and go home.
But the industry can’t do that. If auto-enrolment is to become a successful pension provision, we have to help employees make good choices.
We should use words that normal people use and invite them to make the most of an opportunity. Instead, we are using words that keep people at arm’s length, such as drawdown and risk profile, and scaring them into taking responsibility.
We interviewed people for the National Association of Pension Funds (NAPF) conference last year. Bright people. Out of 17, only two could tell us what an annuity is. Worse still, they told us they felt “stupid”. We’ve done that to them. And when people feel stupid, they switch off. That’s not going to help them make the most of an opportunity.
It’s our responsibility to bring people into the conversation. We can do this by talking in a way that’s clear, vivid and real.
Clear means making sure employees get it first time. Asking them to navigate between advice and guidance is a perfect example of how our language creates needless confusion.
Vivid and real means making sure that what we say sticks in people’s minds. We need to focus on the benefit of saving, rather than the process. When we asked those people on the street what a pension is, they talked about their future, what life will look and feel like many years from now.
They didn’t go on about contribution levels or tax efficiency. But that’s where we keep starting the conversation. We need to start the conversation where those people would start it. And we need to use pensions language that makes them feel like they can join in.
Vincent Franklin is a creative partner at communication consultancy Quietroom.