For immediate release: Thursday, 29 September 2016
- 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.
Nearly half (40%) of 18-30 year olds consider their knowledge of pensions to be poor or very poor and three in five (60%) don’t know what a workplace pension is according to research* from workplace pensions provider NOW: Pensions.
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.
Please click here to view our pension jargon buster infographic.
For further information:
Tel: 0207 566 9760
Notes to editors
*Research conducted by Opinium online with 1,000 UK adults aged 18-30 in May 2016.
NOW: Pensions www.nowpensions.com @nowpensions
NOW: Pensions is an independent, multi-employer trust serving thousands of employers and hundreds of thousands of employees from a wide range of sectors.
A subsidiary of one of Europe’s largest pension funds, Danish pension scheme ATP, NOW: Pensions offers a simple and cost effective workplace pension solution direct to employers and via advisers and the payroll sector.
In April 2013, NOW: Pensions became the first master trust to attain the NAPF’s new PQM Ready Standard. The benchmark shows employers that NOW: Pensions is a well governed pension scheme with low charges and good member communications.
In January 2015, NOW: Pensions achieved independent assurance of scheme quality in accordance with the new master trust assurance framework (AAF02/07) introduced by The Pensions Regulator (TPR) in conjunction with the Institute of Chartered Accountants in England and Wales (ICAEW).
The NOW: Pension Trustee Directors, whose role is to safeguard the interests of members, comprises well-known industry figures with different areas of expertise:
- Jocelyn Blackwell, founding partner Dunnett Shaw
- Christopher Daykin, former Government Actuary
- John Monks, member of House of Lords and former General Secretary of ETUC and TUC
- Win Robbins, former Head of European Fixed Income at Barclays Global Investors
- Nigel Waterson, former Shadow Pensions Minister
Employee charges are just £1.50 per month administration charge (reduced administration charge of £0.30 – £1.00 to be applied during auto enrolment phasing for lower earners) plus a 0.3% annual product investment management charge, with no hidden charges.