Member communication approaches – what can DB schemes learn from the DC environment?
Many pensions professionals have the privilege of working on both defined benefit (DB) and defined contribution (DC) schemes. There are plenty of differences between the two, and my experience has been that DC schemes are generally doing a better job of communicating the potential retirement options to their members in a way that helps them make a confident retirement decision.
With this in mind and retirement options becoming increasingly complex, might it be beneficial for DB schemes to communicate more like their DC counterparts?
Why is communication so important for DB schemes?
Most DB schemes share common characteristics that make good communication with their members vital. These are:
- A ‘Normal Retirement Age’ (NRA), set many decades ago. This age is now likely inconsistent with the State Pension Age and members’ view of when they may be able to retire.
- Some schemes having been closed to members and accrual for many years. Many members may not be fully aware of what their DB pension could provide, especially as DB benefit statements are not required.
- The age profile of non-pensioner DB members is such that a large proportion are at, or getting close to, retirement age. For those running a DB scheme, it’s likely that the bulk of your non-pensioners will be considering their retirement decision soon, and targeted communication may help members understand the support that is available when making that decision.
- Members often have multiple sources of retirement income. It’s less common now than ever before for members to get to retirement with one DB pension, and they likely have to make a retirement decision which includes DC pots, the State Pension and wider savings alongside their DB income.
Unfortunately, many members aren’t as engaged with their pension scheme(s) as pensions professionals would like them to be. They need reminders to engage, and support to be able to tackle their retirement decision with confidence.
When should DB schemes communicate?
Typically, I don’t see pensions communications with DB members until they are 3-12 months from retirement, (often referred to as a ‘wake-up’ communication). But with a wealth of options available, planning an ideal retirement in a year will be hard, let alone in 3 months!
It would be better for communications to come earlier, and at the right times for members. Many DC Schemes communicate with members throughout their lifetime, at significant birthdays and life events. Targeted communications at specific ages (for example age 55 which is currently often the first time that members can take benefits), help ensure that members understand their options and the support available to shape their retirement decision.
Some trustee boards worry about overcommunication, leading to important messages being ignored. This can happen, but what I’m advocating for here are communications at the right time that spur member engagement (more on that in a minute). Not just trying to ‘wake-up’ members 3 months before retirement but instead engaging with them on a milestone birthday for example will help them to understand the retirement options and support available and only adds sightly to the communications they receive.
What should be communicated?
It’s always useful to remind members what options they have, and how they can access retirement support provided or facilitated by the scheme. Aon’s 2025/26 Global Pension Risk Survey showed that around one-third of DB schemes have a preferred independent financial adviser (IFA) that’s trained on the scheme’s benefits, and around half have some sort of technological support in place, such as educational modellers that allow members to understand their retirement options better. Lloyds Banking Group research has shown that over 28 million adults used AI to help make financial decisions last year, however, detailed research from Aon has highlighted that while AI has the potential to make pension information more accessible and easier to understand, there are considerable risks that come with relying on it alone. These include inconsistent advice, calculation errors, and an overconfident tone that could mislead users into thinking they are making the best decisions without professional input. It may therefore be helpful to remind members of these risks and point them to scheme specific resources. Members will get far more value out of the resources schemes are paying for if they’re reminded to access them years in advance, when they have time to use the support and understand all the options available to them, rather than close to retirement when they may want to access their income more immediately.
What if my scheme doesn't offer specific financial advice?
Even schemes that don’t offer members specific financial advice or support can direct members to free tools and modellers they may be unaware of. Guiide’s free pension calculator is an excellent starting point for those planning their retirement, allowing members to bring together multiple sources of income into one retirement plan. There are also modellers in the market that allow people to consider their DB and DC benefits together when appropriate, helping to build a more complete retirement picture.
Pensions Dashboards will be helpful to members too, helping members to get over the first hurdle of understanding the different pensions that they have. However, seeing this information (which will not be transactable figures, and will be a mix of annual DB incomes and DC pots) is likely to lead to members asking: ‘what do I do with this information?’ Schemes should proactively communicate with members to explain what information their dashboards will show, and where to go for more information.
How should DB schemes communicate?
Unfortunately, there’s no magic answer here, and all schemes should consider the specific needs of their membership. However, the message I’m looking to get across is that just sending a communication 3 months in advance of a member’s NRA does not give the member sufficient time to plan for their retirement. A varied approach to communications can be useful, ensuring you capture different types of members and helping communications to remain fresh and interesting. Electronic communications tend to cost far less (which can otherwise be a barrier to smaller schemes), and many schemes now collate their communications on dedicated scheme websites. Paper communications shouldn’t be forgotten though, a well-placed postcard on a significant birthday might be just what’s needed to get members engaged.
Retirement decisions are more varied than ever, and when we look at the maturity of the DB market there are a lot of members currently making choices. Some DB schemes need a wake-up call that their DC equivalents are doing it better, but there’s little to stop DB schemes from upping their game. Communications that give members the information they need, access to support to allow them to feel confident, and enough time to make a considered decision will be best placed to support their members in an increasingly challenging environment.
To keep the conversation going, contact client director Curtis Mitchell.
Special thanks to Aon for letting us incorporate their research into this article and to Edward Burns for his contributions.
