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Royal London finds millions unaware of the power of their pension

-Over three quarters (77%) of UK adults class themselves as ‘climate conscious’;

-However, nearly two thirds (64%) of pension holders are unaware their pension could help fight climate change including over half of men (58%) and almost three quarters (71%) of women; and

-Almost one in four (23%) of pension holders want at least half of their pension invested responsibly.

New research from Royal London, reveals that almost two thirds (64%) of UK pension holders are unaware that their pension could be invested in ways to help fight climate change. One in six (17%) of UK pension holders currently invest their pension responsibly, but 41% say they would like their pension to be invested responsibly.

Terminology can be confusing. Three out of five (59%) UK adults are familiar with the term ‘responsible investment,’ but only 26 per cent actually know what it means and understand its collective power to protect the planet. Men are more likely to be familiar with the term responsible investment than women (69% vs 50%).

The power of pensions

More than half (56%) of pension holders said they would consider investing a portion of their pension responsibly. Around a quarter (23%) were willing for at least half their pension to be invested responsibly. With one in ten (11%) wanting between 90% and 100% of their pension invested responsibly.

With over half (57%) of 18-24-year-olds wanting their pension investments to harness a more sustainable planet, compared to just over a quarter (29%) of 65-year-olds and over, it’s clear there is still more that can be done to build a better understanding of inter-generational financial resilience for the future.

Pension holders were also asked what criteria they would like a responsibly invested pension to consider, with climate change and protecting the environment (42%) being highly rated. Social factors such as health and safety (29%) and use of plastic (28%) followed closely behind.

Sarah Pennells, Consumer Finance Specialist at Royal London, said: “It’s encouraging to see that so many people consider themselves to be climate conscious and our research shows that the nation is taking steps forward to improve the health of the planet.”

The research also found:

  • More than half (53%) of pension holders do not know how their pension funds are invested.
  • Those who want to find out more about responsible investment would mostly value the advice of financial advisers (19%), free guidance services, such as MoneyHelper (14%) or their family and friends (10%).
  • Nearly a quarter (23%) would carry out their own research to find out about responsible investment.

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