The household and health products company’s scheme has made a series of changes to its communications as part of a drive to encourage younger and lower-paid members to put away more for their retirement.
Schemes are increasingly turning to saving modellers and social media campaigns to push younger employees to put more into their pension, in a difficult economic climate for first-time savers.
Reckitt Benckiser's DC scheme: in numbers
Active members: 2,600.
Employer contribution: 10 per cent.
Employee contribution: 0 per cent.
Reckitt Benckiser Pension Fund’s defined contribution section does not require employees to pay contributions. The employer pays 10 per cent of workers' salary into the scheme, after being auto-enrolled upon joining the company.
Chris Little, UK pensions manager, said encouraging those in their twenties to make additional contributions is proving a difficult but important challenge for the scheme.
"I have adapted our annual magazine to aim it more at the younger or lower-paid employees and also separated it from our defined benefit magazine," he said.
"I also wrote an article in our internal company magazine to advertise pensions and I do believe [the current] publicity is the key."
The company targeted the following messages at staff:
Employees were encouraged to trial paying 1 per cent of their salary into their pension pot last year. A newsletter encouraged them to start it from January 1 as a new year's resolution.
On an annual salary of £25,000, this was broken down to £16.66 a month or £3.85 a week, after tax relief, to give them an idea of the actual cost impact.
Between September – when the engagement drive kicked off – and January, 12 members chose to put more away for their retirement, with half of those being younger workers.
The scheme is planning to conduct staff presentations in the summer to encourage a greater part of its 2,600 active members to increase their contributions. “I will be using our internal social media to advertise these presentations,” said Little.
The scheme is to make it mandatory for its human resources staff to attend those presentations so that new employees can be encouraged to contribute from the moment they join the company, Little added.
How to engage younger staff
Karen Heath, chief engagement officer at communication provider Antony Hodges Consulting, said online modellers could be useful to demonstrate how members can afford to make more contributions through small changes to their lifestyle.
The company has launched one such tool with funds in UK and Australia called Small Change, Big Savings, which allows members to see the potential impact of replacing some of their lifestyle spending with retirement saving.
She added: “The young are impatient, we live in an immediate world and their attitude to pension savings is no different.
“You have to get their attention quickly and make it easy for them to take action, there and then.”
Last year,Pensions Week reported on the challenge faced by under-30s on the affordability of pension saving, and whether it was the best vehicle for them to save into retirement.
Student debt, a tough property market and living costs are detering younger employees from putting money away for their retirement, said Greg Thorley, director at Face To Face Consultancy.
It was important to cater to a generation that was used to accessing information online, he added. "Often, younger members will prefer reflection time, access to the detail in an electronic form and an opportunity to interrogate and question via online chat or blogs.
"This provides the element of control and choice that they expect to find in all their interactions as consumers in a digital world."
