Pension industry must simplify terminology

Consumer research carried out for The Pensions Report, published by Defaqto, strongly suggested that the language used by the pensions industry leaves consumers cold and apprehensive.

When taken together with the fact that the word ‘pension’ is itself tarnished in the public eye, rebuilding faith in pension savings should be at the top of the industry’s agenda.

Matt Ward, Defaqto’s Head of Pensions & Wealth Management believes that in the short-term the industry should start by ‘modernising’ pension terminology.

He says: "Enhanced educational facilities and programmes will play a key role in empowering consumers to make informed financial decisions over the long-term, but the industry can achieve quick wins by simply improving the language used to convey pensions information. The consumer will identify more easily with features and terminology that they see in their everyday life and the industry needs to tap into this ‘translation’ of financial services terminology.”

The Pensions Report was produced by Defaqto in association with The Lyncombe Consultancy, AKG Actuaries & Consultants and Judy Jones Research & Planning Consultant. Mastek and Xafinity are co-sponsors of the report.