 Many people lack basic financial knowledge |
Large numbers of Britons find financial products and jargon difficult to understand, a survey from the Institute of Financial Services (IFS) has said. The report said that eight out of 10 people did not know what annual percentage rate (APR) meant.
It also said that about 40% did not understand products such as mortgages and Individual Savings Accounts.
The IFS, a financial education charity, said financial knowledge must improve or the UK's pension crisis could worsen
"Unless tackled this (financial illiteracy) will lead to an over reliance on the state in old age as people continue to be unable, or unwilling, to determine the right solutions to their own needs," said Gavin Shreeve, IFS chief executive.
A recent government-sponsored report into pensions revealed that among people 25 or over, 12.1 million are failing to save enough to enjoy a comfortable retirement.
The Pensions Commission report blamed the savings shortfall in part on lack of public knowledge of financial services.
The IFS provides financial education study packs to 92 UK schools.
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