Rebranding pension schemes could encourage more people to save because the term ‘pension’ has become tarnished, said Martin Lewis, journalist and creator of Moneysavingexpert.com.
Speaking on the first day of the National Association of Pension Funds’ (NAPF) conference, Lewis said that pensions and the pensions industry has been tarnished in part because of financial mis-selling scandals, people losing money in schemes due to the economic situation and a lack of understanding of what a pension is. He said that this has led to people not saving in pension schemes for their retirement.
“The brand of pension and pension as a word is incredibly tainted and tarnished.
“This is a great challenge, what do we do about the tarnishing of the brand?” Lewis said.
Lewis suggested a change of terminology, scrapping the term ‘pension’ in favour of another term such as retirement savings could improve the image of the industry. But this would require the whole industry to get on board along with regulatory and political backing.
Lewis added that auto-enrolment could also be helpful in rectifying the lack of pension savings and view on saving for retirement. However, he said that there needed to be more education about the subject beyond the government advertising campaign.
He also suggested introducing financial education from an early age. “We need compulsory financial education on the curriculum and it is a national disgrace that every politician should hang there head in shame that we have now educated our youth into what we call debt when they go to university but never educated them on debt.”
People considering saving now for retirement would also benefit from education on what a pension is and what risk is when saving in a pension.