Savings bank Raisin reveals the financial terms Brits don’t understand
22% Of UK Adults Are Confused By Financial Terms
Are you a savvy saver or flummoxed by financial terms? Well if you fall into the second category you are not alone, as more than a fifth (22%) of UK adults have admitted that they have been made to feel stupid when asking what certain terms mean when it comes to their finances.
The research, commissioned by personal savings service Raisin.co.uk, revealed that more than two in five (42%) are concerned they are not making the most of their money because they lack vital financial knowledge – this figure rises to 57% among 23-34 year olds, and worryingly, 56% of those weighed down by debt.
For example, despite words like inflation and recession appearing widely in the media, especially recently in the midst of the current pandemic, about a fifth confess to not knowing what they mean (19% and 20% respectively).
As few as 22% of adults feel they can turn to friends or family who work in the industry to help them understand the financial jargon, with only 15% speaking to their parents.
People Are Too Fearful To Speak About These Issues
Discussing the research, Raisin.co.uk co-founder, Kevin Mountford commented: “The last 12-months have been incredibly testing for UK consumers – with multiple rate drops from the Bank of England to wide-spread speculation of a recession and negative interest rates – there is a lot for consumers to process. The research clearly shows that people are too ashamed or fearful to speak to friends or family about these issues.
“If you do not know something, you should never be afraid to ask a question to make sure you have all the facts and can make the best decision. Whether it’s finding the most competitive savings rate to maximise your earnings, or the cheapest loan deal to ensure you do not pay over the odds”.
The financial terms causing the most confusion amongst UK consumers are: Effective Annual Rate (EAR: 77%), Annual Equivalent Rate (AER: 62%), Gross Domestic Product (GDP: 43%). Annual Percentage Rate (APR: 34%), Variable Interest Savings (29%) and Stocks & Shares (28%).