Why Pension Choice Matters More to Your Employees Than You Think

Most employees say they would value being able to choose their own pension provider more than a gym membership or a retail discount. This matters for every organisation that wants to offer benefits that feel meaningful rather than benefits that look good on paper. The workplace has changed, personal finance expectations have shifted, and people are thinking more actively about their long term security. Pension choice sits at the centre of this shift and HR teams are in a unique position to lead it.

When employees talk about choice, they are not asking to create complexity. They want a clear path that supports the way they already manage their finances. Younger employees often start with multiple small pots from early jobs. They move roles more frequently than before and want to build a single, visible picture of their retirement savings. Being able to direct new contributions into a pension they already use removes friction. It lowers the chance of losing track of small pots and increases confidence in the value of saving early.

In February 2025, research by Aegon UK reported that 68 percent of employees would prefer greater control over where their pension contributions go rather than additional short term lifestyle benefits such as gym memberships or retail discounts. This was most pronounced among employees aged 25 to 44 who said pension flexibility would improve both engagement and confidence in their long term savings.

Employees in their thirties and forties tend to value alignment. They want their workplace contributions invested in the same way as the rest of their pension. Many are raising families or planning for major life events. A single pension feels more manageable and allows them to keep their risk profile consistent. Directing contributions to an existing pension supports these goals and helps them feel more in control of long term outcomes.

Older employees often expect stability, many have chosen a provider based on service, performance or personal advice. They do not want to start again with every career move. The ability to continue using a trusted pension provider gives them continuity and a sense of security. This is the kind of benefit that builds loyalty at a time when financial planning becomes more serious.

The value of pension choice goes far beyond convenience, it strengthens financial wellbeing because it meets people where they are. Most employees already use digital tools to manage money, track investments and consolidate accounts. Choosing their pension provider fits with how they organise the rest of their financial life. It also reduces the likelihood of disengagement which is a common issue when employees feel disconnected from their pension.

For HR leaders, this is a practical opportunity, your benefits teams spend time shaping packages that support attraction, retention and wellbeing, yet many benefits have a short shelf life. A gym membership is useful for some. Retail discounts help in the short term, but pension choice supports long term financial resilience and creates value that grows over time. It is one of the few benefits that genuinely compounds.

It also supports inclusion, people have different levels of financial confidence. A member in their early twenties might prefer a modern digital pension with clear education. A member in their fifties may rely on a provider that has supported them for years. Choice respects these differences and gives everyone a fair way to manage their future.

For employers, enabling pension choice does not have to increase your operational burden. Modern platforms make it possible for members to route contributions to an existing pension without disrupting payroll or adding new admin.

The result is a benefit that feels modern, member led and aligned with what people genuinely value.

Pension choice is a shift in expectations, employees want flexibility, clarity and the ability to build long term value on their own terms. For HR benefits and rewards teams, supporting this choice sends a clear signal that your organisation takes financial wellbeing seriously. It shows that you understand what matters most to people at different stages of their working life.

The outcome is simple, when employees can use the pension that works for them, engagement rises and confidence grows. The benefit you provide becomes something people talk about with pride rather than something they ignore. This is the future of workplace benefits and it is already here.

If you would like to explore how pension choice can fit into your benefits strategy, Nexum can help you make it simple for both members and payroll teams.