• Nearly half of 18 – 30 year olds admit to poor knowledge of pensions
• Over half (58%) don’t know what auto enrolment is
• Nearly three quarters (71%) of 18-30 year olds say they find pension terminology and jargon a barrier to engaging with the subject.
When asked why they consider their knowledge of pensions to be poor, two in five (42%) say they don’t need to understand them as they are a long way off retirement, and around one in four (27%) say they find pensions too complex, whilst nearly three quarters (71%) of 18-30 year olds say they find pension terminology and jargon a barrier to engaging with the subject.
Despite anyone over the age of 22 earning at least £10,000 a year being auto enrolled into a workplace pension, as part of the new workplace pensions legislation introduced in 2012, over half (58%) of 18-30 year olds admitted they still don’t know what auto enrolment is.
When it comes to understanding other financial products, knowledge of savings and credit cards is better with only 13% and 19% respectively stating they have a poor understanding. In fact, the only financial services product that young people feel they have less understanding of other than pensions, was investments, where 43% say they have a poor or very poor understanding.
Morten Nilsson, CEO of NOW: Pensions said: “This pensions blind spot amongst younger people should be raising a warning flag for the government and industry.
“Auto enrolment is going to bring thousands of younger people into workplace pension saving, but if their understanding is poor, there’s a real risk that the policy will be undermined.
“The industry needs to work harder to eradicate jargon, making pensions more understandable for young people so the benefits are better understood.”
NOW: Pensions has teamed up with television presenter and reality TV star Stacey Solomon to help explain some of the jargon associated with pensions. To watch Stacey explain click here
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