SPONSORED COMMENT
The 2024 government report ‘Engaging with Pensions at Timely Moments’ highlighted that attitudes towards pensions are often characterised by detachment, apprehension and fear creating significant obstacles to engagement. However, the Mercer Master Trust (MMT) is challenging this trend by redefining industry norms across multiple key metrics, effectively raising the bar for what constitutes good member engagement.
MMT data highlights:
- Beneficiary Engagement: MMT members are demonstrating a proactive approach, with nearly twice as many adding beneficiaries last year, compared to the market comparator. This reflects MMT’s commitment to ensuring that members feel secure and supported in their financial decisions, as emphasised in their report, ‘If People Could Choose Their Pension,’ which underscores the importance of member involvement in pension choices.
- Retirement Planning: A remarkable 50% more MMT members are actively selecting a retirement age for their scheme, rather than allowing it to default to the scheme’s pre-set options. Importantly, this serves as a barometer of understanding not just engagement. Recognising the importance of aligning a stated retirement date with the anticipated need for funds requires a degree of involvement from the member. Tools such as the MMT Retirement Planner equip members with the financial literacy necessary to make informed decisions about targeting pension access to a realistic and achievable date.
- Income Drawdown Participation: MMT members are entering income drawdown at a rate 2.6 times higher than the market sample, reflecting growing confidence in managing their retirement income. Ultimately, a pension is designed to provide a sustainable retirement income, rather than a lump sum. A scheme that encourages more of its members to utilise their funds for ongoing income demonstrates its commitment to fulfilling its lifelong promise.
- Member app engagement: Nearly six times as many MMT members visited the MMT member app three times or more in Q4 2024, compared to the market sample. MMT’s member app, Mercer Money, not only features consumer-grade design and ease of use, but also allows members to aggregate their pension, and broader wealth into one place. This functionality helps individuals feel more in control and provides greater insight for strategic planning.
These results are based on an analysis of over 700,000 workplace pension scheme members, highlighting MMT’s commitment to accountability and member engagement.
“These results are a testament to our ongoing efforts to enhance member engagement and education,” said Tom Higham, Head of Engagement, Mercer Master Trust. “In a landscape where many feel disconnected from their pensions, we’re seeing increasingly high levels of engagement. Our experience shows that the better people engage, the more informed their decision making becomes at the point of accessing savings.
“Our goal is to ensure that our members have the information and guidance they need to make informed choices about their retirement. By equipping members with the right tools, support, and insights, we empower them to take control of their pension savings and secure better financial futures.”
Members of workplace schemes often have little say in who provides their pension. However, what if they could choose their workplace pension in the same way they select their utility providers, or supermarkets? Surely, they would want to know which scheme offers the best chance of a secure retirement. Mercer’s report, ‘If People Could Choose Their Pension’ examines the critical role of member experience and engagement in pension planning. After all, it’s only by fostering an open dialogue about member needs and preferences, that the industry can better understand the evolving landscape of pension planning and the challenges members face.
As the MMT continues to set new standards in member engagement, it remains committed to fostering a culture of financial literacy and empowerment. By prioritising member needs and preferences, MMT is not only enhancing the pension experience but also paving the way for a more secure financial future for all its members.
You can find out more about the MMT on their website.