Around two-thirds (66%) of respondents have little or no understanding of how the tax system impacts pension contributions, according to research by insurance provider Aviva.
Its survey of 2000 working adults in the UK, carried out in August, also found that one in ten respondents have never heard of pension tax relief.
The research also revealed:
- Almost half (49%) believe the language used to talk about pensions is unclear and difficult to understand.
- 12% of respondents say their understanding of pensions has improved since the freedoms were introduced.
- Those aged 55 and over are the most likely to say their understanding has increased.
Andy Briggs (pictured), chief executive officer UK and Ireland Life at Aviva, said: “A pension can be one of the biggest investments a person makes in their life. If they don’t understand the incentive to save that is being offered then this needs to be changed.
“It’s no wonder many people question the value of saving into a pension when two-thirds admit they have very little understanding of the current system of pension tax relief.”
