In light of growing concerns about the cost of living impacting pension savings, WEALTH at work conducted research among employees to gain insights into the real challenges individuals face.

The findings revealed that a minority (13%) have already taken action by reducing or suspending their pension contributions.

More worrisome, however, is that a significant portion (29%) is contemplating discontinuing payments, and another 30 percent are considering reducing their contributions in the future.

Jonathan Watts-Lay, Director of WEALTH at work, emphasises the critical importance of individuals comprehending the repercussions of opting out of their pension plans.

While reducing contributions might provide short-term relief, it will inflict substantial long-term damage on their retirement standard of living.

This is primarily due to the loss of employer contributions and tax relief, which will have a dramatic impact on retirement savings in later years.

Hence, there is an urgent need to ensure that employees are actively engaged with their pension plans.

Below, we outline five crucial steps to boost employee engagement:

  1. Empower Employees with Financial Education: Providing information through websites or leaflets is essential, but the engagement level soars when employees participate in interactive financial education workshops. Leading employers are increasingly adopting virtual or in-person seminars to assist their employees. This education should be customised based on career stages:
  • Early Career (Getting in the Savings Habit): Help individuals understand the implications of auto-enrollment and whether they should consider increasing their contributions, possibly with additional employer support.
  • Mid-Career (Staying on Course): Conduct a financial ‘MOT’ to assess the adequacy of pension and retirement savings. Focus on aligning investments with retirement goals, moving away from overly conservative approaches for those entering drawdown.
  • Pre-Retirement (Retiring Well): Offer support for retirement planning, debt management, maximising pension benefits, and tax-efficient savings. Provide guidance on retirement goals, income generation, risk assessment, tax planning, and seeking further advice.
  1. Offer Access to Supporting Tools: Cater to various learning styles and preferences with interactive tools, videos, animations, or an online ‘Financial Healthcheck.’ Cover topics such as pension comprehension and retirement income options.
  2. Run Financial Guidance Sessions: Provide one-on-one financial guidance or coaching sessions, particularly beneficial for those nearing retirement. These sessions can be delivered via video calls or telephone, helping individuals understand their next steps and whether they require further regulated financial advice.
  3. Provide Access to Regulated Financial Advice: Especially pertinent for those approaching retirement, facilitate access to reputable advisory firms with appropriate qualifications, regulatory records, and transparent pricing structures. Prevent individuals from navigating complex financial decisions alone.
  4. Bring in a Provider: Many employers and trustees are now enlisting specialised financial wellbeing and retirement service providers to support employees throughout their careers. Collaborating with reputable firms enhances the process’s robustness and empowers individuals to maximise their life savings.

Jonathan Watts-Lay, Director of WEALTH at work, highlights the positive trend of leading workplaces and trustees offering financial wellbeing programs. These programs encompass financial education workshops, one-on-one guidance, digital tools, and helplines. They serve as invaluable resources to help individuals manage their workplace savings, make informed financial decisions, and navigate the choices associated with retirement.





Amelia Brand is the Editor for HRreview, and host of the HR in Review podcast series. With a Master’s degree in Legal and Political Theory, her particular interests within HR include employment law, DE&I, and wellbeing within the workplace. Prior to working with HRreview, Amelia was Sub-Editor of a magazine, and Editor of the Environmental Justice Project at University College London, writing and overseeing articles into UCL’s weekly newsletter. Her previous academic work has focused on philosophy, politics and law, with a special focus on how artificial intelligence will feature in the future.