3 myths that cause employers to postpone pension arrangements

Ramses van de Nes
October 14, 2024
5
 min

In our discussions with employers, we notice that they often postpone arranging pensions. It is understandable that arranging a pension may not be your first priority. As an entrepreneur, you already have enough on your mind. But what if we told you that it is much simpler and more affordable than you think? In this blog, we discuss the 3 myths that cause employers to postpone arranging pensions and show how easy it is to start with a pension.

Arranging a pension? We'll do that when...

Which of the following procrastination 'excuses' do you recognize? 


“Yes, we definitely want to arrange a pension once we have had the next fundraising round.” 
“Our team is not yet big enough to arrange a pension.”
“We are very busy now because we (...) once we are done with this, we can think about pensions.”

These are all very understandable and well-considered reasons to postpone retirement. That's why we hear them so often. You are not the only one! It is just a shame that these reasons for postponing are based on the myths of expensive, complicated, and time-consuming. But the opposite is true. Arranging a pension actually gives you a high ROI: it costs little time and money for what you get in return, and you bind employees to the organization. Not unimportant as a start-up or scale-up. Pension is an important employment condition that helps you attract and retain talent. Moreover, you help your employees plan for their future.

Let's take a look at the myths that exist about pensions.

Myth 1: Pensions are complicated

In the collective consciousness, a pension is like an iceberg in the water. You know it's there, because you see the tip, which is a representation of the concept of pension. But you have no idea how it works, because about 80% of the iceberg is below the surface of the water. So of course you prefer to postpone arranging your pension until you finally land that one big client. Because finding out how big the iceberg is below the surface takes a lot of effort and is quite complicated. After all, you don't dive into the icy water unprepared. But pensions are a lot less complicated than you think. It's just that pension funds haven't traditionally been that transparent. And technical terms such as funding ratio, available space and pension pillars don't make it much clearer either (and our government website doesn't always help with that either). We want to change this at Vive, which is why we write blogs like this one about the pension pillars.

Myth 2: Setting up a pension takes a lot of time

News about pensions, whether it concerns negotiations (for example, collective labor agreement negotiations) or reaching an agreement, always have something in common: long lead times. 

Take the Pension Agreement for example. This was achieved in June 2019 after unions, employers and the government had negotiated for 10! years. Elaborating that agreement in the Future Pensions Act, took another 4 years. And then we're not even talking about setting up the pension itself. In addition, with most traditional pension providers, it really takes a long time before they have set up a pension for your employees. Because this is often accompanied by the drafting of entire volumes of regulations and a legion of pension advisors. It is therefore logical that the myth that setting up a pension costs a lot of time has arisen. 

But this doesn't have to be the case. With us, arranging a pension is not a lengthy, bureaucratic process. Within one working day you can have a fully functioning pension plan, without it costing you valuable time or energy. All you have to do is fill in a few details, sit down with us once and then we'll do the rest. You can find more information about this in our blog about onboarding at Vive. 

Myth 3: Pensions are expensive

Okay, let's be honest, because you're not crazy! This myth is based on a historical fact. The traditional pension was and is expensive. What makes it expensive, among other things, are the pension intermediaries who profit from myths 1 and 2 (not to mention the administrative hassle). But pensions really don't have to be expensive. You can start with a pension plan for just a few euros per month. In addition, there are flexible options that allow you to scale up or down whenever you want. So you don't have to wait for the next big client or fundraising—you can start right away without putting a huge strain on your budget.

Too good to be true?

When employers hear from us that you can arrange a pension within a day for about 6 euros per employee per month, they are initially surprised and amazed. “Wow, I seriously didn't know it was that easy,” we regularly hear. But also: “This sounds too good to be true.” This indicates how strongly the myths are engraved in our collective consciousness. We simply do not believe that pension can be easy, flexible, transparent and cheap. And yet it is. So you don't have to postpone it until the next fundraising or until you are in calmer waters. And even if your employees are not asking for it yet, it is nice to have it arranged already, so that you can put it in your vacancies. In addition, you really make your people happy with it. So don't postpone arranging a pension any longer!

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