Almost half of Ontario pension plan members don’t understand investment phrases, terminology and information that could be crucial to them, according to a new poll conducted on behalf of the Investor Education Fund (IEF).

“A company pension plan can make a significant difference to the quality of someone’s retirement years. Members can be missing out on the potential rewards of their plan, unless they thoroughly understand it, and the impact their pension decisions can make,” said Terri Williams, president of IEF, in a release.

IEF says this is especially true of defined contribution (DC) plans and group RRSPs where employees have to make investment choices within the plan. Such plans are increasingly popular with employers due to administrative cost savings. IEF notes that membership in DC plans in Canada doubled between 1992 and 2001.

As of Dec. 31, 2005, IEF says employers who offer these types of plans should be providing more educational tools and resources to their members, according to the Capital Accumulation Plan Guidelines issued by the Joint Forum of Financial Market Regulators earlier this year.

The IEF says human resources professionals have an enormous role to play in communicating and educating staff about the company pension and its significance to their retirement savings. In fact, the survey found that the greatest number (20%) of Ontario pension plan members named their HR contact as their most trustworthy source of pension information.

The IEF notes that smaller firms, with less than 500 employees, may encounter the most difficulties educating employees about pension plans due to a lack of resources and dedicated staffing.

To help companies respond to their employees’ need for education about pensions and investing, IEF urges companies to direct employees to its online resource, Focus On…Pension Decisions, available at its web site.

The Decima Research poll was conducted between August 11 and August 22, 2004 through the Decima teleVox, an omnibus telephone survey. The survey results are based on a representative randomly selected sample of 419 adult Ontarians who are employed or retired. Results for a sample of this size are considered accurate to within +/-4.8%, 19 times out of 20, if the entire adult Ontario population was polled. The data was weighed to ensure the sample’s regional and age/sex composition mirrors that of the actual Ontario population according to the 2001 Census data.