Digital solutions increase member engagement with pensions by up to 30 per cent, says Buck
Buck, a consulting, technology, and administration services firm specialising in pensions and employee benefits, has unveiled data gathered from across its pension schemes showing the positive impact of digital solutions in increasing engagement with pensions among scheme members.
The statistics from 2020 — collected from over 165,000 pension scheme members who have online, real-time access to their scheme benefits through Buck’s digital portal and animated pension summary tool — show that engagement among members increased to between 30 per cent and 40 per cent on average after the launch of a digital portal providing access to pension benefits, compared to an average industry engagement level of around 10 per cent.
Schemes which have adopted a digital solution for members to gain real-time access to their pensions have also seen a dramatic increase in member contributions within three months of launching the solution. Typically, schemes have seen the number of members increasing their contribution rate double and, in some cases, it has increased by over 130 per cent.
As part of its commitment to, and investment in, technology-led solutions, Buck launched its DC animated pension summary tool in the UK and the Republic of Ireland in 2020, working in conjunction with its long-term financial technology partner, EV. The new digital tool was the first of its kind in the market and supplements traditional paper statements, giving scheme members anytime-access to an animated real-time summary of their pension pots. Across the last year, Buck has also developed and launched 25 member portals, opening up its technology to an additional 90,000 scheme members, meaning 75 per cent of members Buck serves now have access to online technology.
The animated summary aims to boost engagement from scheme members by providing them with a clear view of the last 12 months of pension contributions, as well as allowing them to track their progress against their future retirement financial plan. If members are not on track to meet their goals, the tool also provides recommendations for simple changes they can make to ensure they don’t miss their targets.
The tool can also be used to support any communications exercises which schemes undertake and ensure members have the ability to stay on top of their pension saving all year round.
Lee Cook, Head of Outsourcing at Buck in the UK, comments: “Member engagement has always been a challenge for schemes. In the last year, many members have moved into a more physically isolated environment, meaning the quality of member communications is more important than ever. And effective technology has been the lynchpin in enabling employers to continue to deliver on the social contract.
“Digital solutions that involve members and ‘nudge’ them towards interacting with their pension are a huge step forward in engaging individuals, both at the day-to-day level and in conjunction with any specific exercises schemes may aim to undertake. The tangible success we’ve seen using Buck’s animated pension summary tool with our clients is demonstrated by the increase in member engagement, rise in contributions, and decrease in the risk of under-funding.”
Gary Wheeler, Chief Commercial Officer at EV, comments: “Buck’s status as a market-leading pension administrator makes them a fantastic partner to work with to bring EV’s technology to the market. We’re really excited that Buck have been able to evidence more scheme member engagement and that this has led to an enormous increase in contributions. Ultimately, both EV and Buck strive to deliver the best possible experience to clients and scheme members. By delivering new tools and new benefits for pension schemes that drastically improve transparency for their members, it's really exciting to be able to demonstrate such a positive impact with these solutions in the pensions space.”