Pension Awareness Day: the science of a benefit that actually lands

Every year, employers spend a great deal designing benefits packages they hope their people will value, and every year, a stubborn gap opens up between what is offered and what is understood. It’s all too tempting to put this down to poor communication or busy inboxes. The more interesting explanation, and the more useful one, comes from behavioural science: our brains are quietly working against good decisions, and pensions are where they work hardest.

Understanding why is the first step to designing communication that actually lands. Here are three questions to ask your team.

Do your people actually understand what you offer?

Start with the most uncomfortable question, because the honest answer is often no. Recent research found that just 21% of employees felt they had a very good understanding of all the health and wellbeing benefits available to them, and yet 57% of employers believed their staff fully understood what was on offer.[1]

That mismatch has a name: psychologists call it the ‘curse of knowledge’. Essentially, once you know something inside out, your brain finds it almost impossible to imagine not knowing it. Reward and HR teams live and breathe these benefits, so they tend to assume everyone else does too. It’s not complacency, it’s a well-documented cognitive bias, and it means the gap is invisible from the inside.

The lesson from the science is that clarity has to be engineered, not assumed. What feels obvious to the people who built the package will rarely feel obvious to the people receiving it.

Do you have an engagement strategy, or just a benefits package?

The second question separates provision from engagement. A 2025 survey found that 29% of employers have no engagement strategy at all, though a further 26% intend to introduce one.[2]

That last figure is itself a piece of behavioural science in miniature. There’s a well-studied phenomenon called the intention-action gap: people, and organisations, sincerely intend to do the sensible thing but then don’t quite get round to it. A quarter of employers meaning to build a strategy is encouraging, but intention rarely converts into action on its own. It needs a prompt, a deadline, an owner.

The reassuring part is that the same science offers the fix. The single most successful pensions policy of the last two decades – automatic enrolment – works precisely because it stopped relying on people to act and redesigned the default instead. Auto-enrolment is behavioural science made real. It didn’t lecture people into saving; it made saving the path of least resistance. The same principle applies to any benefit. Design the journey around how people actually behave, not how we wish they did.

How do you know it is working?

The third question is about evidence, and here pensions present the hardest problem of all. The value of a pension sits decades in the future, and the human brain is remarkably bad at valuing the future. Behavioural economists call it present bias: a pound today feels far more real than a much larger sum in thirty years. It’s why people disengage from the very benefit that may matter most to them.

There’s a striking strand of research that suggests we treat our own future selves almost like strangers, which is part of why saving for retirement can feel oddly like giving money away. Once you understand that, you communicate differently, as you make the future feel closer and more concrete: you show people the person they’re actually saving for. On Pension Awareness Day, of all days, that’s worth remembering. The benefits people need to understand most are the ones their own psychology quietly encourages them to ignore.

The employers who get the most from their spend are the ones who treat engagement as something to measure and test rather than assume – looking at take-up, asking people what they genuinely understand, and adjusting accordingly.

If there’s one message for employers this Pension Awareness Day, it’s that good benefits are not enough on their own. The science is clear: people don’t make perfectly rational decisions about money, time or the future. Once you accept that, you stop blaming the audience and start designing communication that works with human nature rather than against it. That’s what turns a cost into something your people genuinely value.

To review your benefits engagement with the Mattioli Woods Employee Benefits team, please get in touch.

Sources

• Group Risk Development (GRiD), Opinium research (2023), Only a fifth of employees have a very good understanding of all the health and wellbeing benefits they’re offered. – GRiD
• Aon UK Benefits and Trends Survey 2025, Unlock Key Insights with Aon’s UK Benefits and Trends Survey

Behavioural-science concepts referenced:

• Curse of knowledge: an established cognitive bias, generally attributed to Camerer, Loewenstein and Weber (1989).

• Intention-action (or intention-behaviour) gap: a well-established idea in behavioural psychology.
• Automatic enrolment as a behavioural “default”/nudge: widely discussed in Thaler and Sunstein’s work on nudge theory.
• Present bias/temporal discounting and the “future self” research: the future-self strand is associated with work by Hal Hershfield and colleagues.

[1] [Only a fifth of employees have a very good understanding of all the health and wellbeing benefits they’re offered. – GRiD]

[2] [Unlock Key Insights with Aon’s UK Benefits and Trends Survey]