Do pensions need renaming to avert crisis?

Young people are put off starting a pension because they associate the word with old age, research by AXA has discovered.

One in five 18-24 year olds said they haven’t yet started a pension because they don’t like the word.

The wider population also expressed a dislike to the word pension, with around a fifth associating it with the word ‘grey’, and one in ten thinking the word is old fashioned.

If all the 18-24 year olds who are currently delaying their pension payments continue to do so for another five years, they could find themselves with a total deficit of £44.1 billion, around £44,000 per person, AXA said.

“It’s clear that we need to get younger people thinking about their future financial stability much earlier,” said Mike Morrison, AXA’s head of pensions development.

“Trying to find a more compelling word or phrase is one simple thing we can do.”

AXA is working with Collins English Dictionary to find an alternative word or phrase to encourage young people to save for their future.

Elaine Higgleton, editorial director at Collins English Dictionaries, said she’s not sure what bothers young people about the word ‘pension’.

“Perhaps it’s the association with ‘pensioner’, meaning ‘an elderly person’. Or perhaps the recent and widely reported closing of final-salary pension schemes to new joiners is part of the picture,” she said.

“Whatever the reason, the word ‘pension’ does not seem to be encouraging people to save for the future and a new name might give ‘pensions’ a new image.”

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