When we talk about pension management services, what language should we use?

Industry research tells us that most pension savers don't know what pension services they are receiving from the organisations which manage their pensions for them. That same research also tells us that most savers don't know that they are paying for those services and it can come as a surprise when they find out they are paying something.

Numerous industry initiatives are increasingly raising saver's levels of awareness in terms of what they are paying and this is welcome, but have we given enough thought to the language that we are using and the consequences of using one term instead of another?

Charges is the term most often used by politicians and the media. The term lends itself to populist politicians and media headlines, but in every day use, the word 'charges' is usually associated with 'fines' and 'penalties'. We wouldn't say to people in restaurants that they'll be 'charged' if they eat or drink anything. Using a term with negative connotations is not likely to increase engagement between savers and their pensions and an unintended consequence could be to drive savers towards cash savings which are perceived as being free and which could be an extremely damaging outcome for customers at a time of low interest rates.

Costs is the other term commonly used. However costs are something borne by a business providing a product or a service. A customer purchasing a tin of beans in a supermarket doesn't need to understand the staff costs, the business rates, the transport costs, the heating/refrigeration costs of the supermarket, they just need to understand the Price of the beans, where the price is a function of the combined costs, profit margin and any discounting or incentives.

So is Price a better term? I think its a big improvement over costs and charges, but Price tends to be associated with one off purchases, such as a tank of petrol or a loaf of bread. Ongoing and professional services tend to be expressed in terms of Fees. Examples in my life include my Gym Membership Fees, Legal Fees, Estate Agent Fees, and Factoring Fees.

Pension Management is a suite of professional services assembled into something that many people simply take for granted. The suite of services varies by product type but includes, professions such as Actuaries, Lawyers, Trustees, Asset Managers, Information Technology, Operations Management and Logistics, Tax Experts, and Accountants. To me, pension management shouldn't be on a par with a loaf of bread but should be elevated to at least have parity with the services provided by the people who maintain the weeds in the flowerbeds around my house.

Q: So the term Fees gets my vote? - What would get your vote? One of these 4 or something else?

Returning to my introduction, its important that in raising awareness of what savers are paying, we also raise awareness of what they are getting in return. Savers are not interested in the costs which firms incur; buildings, computers, people, stationary and so on, but they should be told more clearly what services they are receiving. By understanding the services which they receive, savers will be better able to apply value for money judgements to those services and determine whether they could achieve better value elsewhere. By understanding the services included in pension management, savers will be better able to judge the value of a pension relative to alternative savings vehicles which provide a narrower range of services.

I've set out below a simple articulation of the services which savers can expect from pension management.

• Working with your employer to ensure that the correct amount of pension contributions are paid into your pension pot and working with your employer to resolve issues if for any reason your employer was delayed in paying that money.
• Keeping you informed as to how much has gone into your pension pot, what it is presently worth and what the size of your pension pot might be when you come to retire.
• Maintaining records such as your contact details and the details of any beneficiaries in the event of your death.
• Keeping your personal information and your money safe from criminals, including cyber-criminals.
• Providing you with information which might help you decide whether you want to change the amount you save each month or whether you want to change where your money is being invested.
• Helping you understand your retirement options as you get closer to retirement.
• Working with HMRC to ensure that the amount of tax that you pay over time is correct.
• Paying levies into Government schemes which are designed to help and protect pension savers, including ‘Money Helper’ which is a public service offering free guidance on financial matters, and the ‘Financial Services Compensation Scheme’ and 'Pension Protection Fund' which can compensate people if things go wrong. 
• Investing the money in your pension pot in a way which seeks to ensure that each ￡1 in your pension pot can buy more goods and services in the future, than ￡1 could buy you today.  

Q: Have I got these right? Is there anything I'm missing?