Sounding Board: Early engagement key to meaningful relationships with plan members

Retirement is an important milestone. In the pension industry, we understand that active planning is critical to members meeting their goals and being able to enjoy the lifestyle they want in retirement. We also know the reality is most don’t start planning or even thinking about retirement until it’s literally around the corner.

Why? When members are in their 30s and 40s, retirement still seems far away and they have other pressing priorities, such as raising children and saving for their education, buying a house, making mortgage payments and taking vacations.

The challenge for pension plan administrators is how to actively engage members in retirement planning early on and maintain their interest throughout their membership.

It’s critical that pension plans make member engagement a priority early in the process. If we don’t, we lose out on the opportunity to create a meaningful relationship and help members understand the important role their pension plays in their overall retirement and financial plan. This is particularly important when they face pension decisions early on — such as whether to transfer entitlements from another plan or contribute during a leave — that compete with other financial priorities.

Engagement starts with a positive client experience

When the Ontario Pension Board launched advisory services for our members in 2014, the main driver was the realization that most members lacked the pension and financial literacy they needed to make sound pension decisions. We realized members often don’t know what questions to ask or when they should be asking them because they don’t fully understand how a pension decision or opportunity can affect their financial future. That’s why we offer our members access to in-house certified financial planners. The idea is to help them navigate those key pension decisions and understand how they fit into their broader financial plan.

Read: Sounding Board: How the Ontario Pension Board delivers advisory services

Over the past two years, advisors have met with thousands of members to help them navigate key pension decisions. The interactions have highlighted a broader educational opportunity: to help members build overall financial literacy.

Evolving member education

We also believe proactive education and communication are key elements to engaging members in their retirement planning process as soon as they join the plan. Examples of approaches that have helped engage members include welcome calls and advisory workshops. Welcome calls allow us to start the conversation early on and provide an the opportunity to educate members about the value of their pension, as well as discuss key time-sensitive decisions they need to make. The calls also offer an opportunity to introduce the advisory services so members know about the assistance that’s available to them.

Read: Sounding Board: Ontario Pension Board makes the case for asset pooling

In addition to one-on-one advisory services, we also offer ongoing education workshops for members with tailored content geared towards those in their early, mid or late careers. The sessions help strengthen members’ knowledge of retirement and financial planning and their understanding of how the pension fits into their overall financial plan and can reinforce the impact of delaying retirement savings. The information is particularly important for younger members who often have competing financial priorities early in their careers. One of the most effective elements of the workshops is the roundtable discussions with the advisors and other members.

In the end, the goal is to help members understand that they’re planning for their retirement, whether they realize it or not, and that active planning is the best approach to helping them meet their objectives.

The Ontario Pension Board’s approach to member engagement includes:

  • Implementing a member education strategy: Helping members understand the value of their pension and how it fits into their overall financial plan.
  • Welcoming member feedback: Whether it’s negative or positive, feedback provides a great opportunity to improve the member experience.
  • Tailoring the message: With members at various stages in their careers, tailoring content, services and tools to address their current life stage helps ensure the message resonates.
  • Helping them plan: Online tools, like the retirement planner, help members assess how they’re tracking against their retirement goals and draw them back for future advice.
  • Offering access to in-house certified financial planners: Advisors have the pension and financial planning expertise to help members make sound pension decisions.

In an increasingly digital world, members have come to expect self-service and online tools, the challenge is how to offer them in a way that encourages the conversation instead of shutting it down before it starts. The goal is to provide members with access to online planning tools and encourage them to come back to discuss the results. We’ve made that easy by allowing them to book a one-on-one session with our advisors from the same secure site where they use the tools.

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Engaging with members throughout their career not only allows them to be better informed and educated about their pension, but it helps protect their financial security.

Members have responded very well to both the advisory services and the education sessions. We’ve found that when members feel they’ve gained valuable insights about their pension and personal financial situation, they’ll turn to us again the next time they’re facing a decision.

Peter Shena is executive vice-president and chief pension officer at the Ontario Pension Board.