Financial jargon is putting us off investing. STEPHEN LEWIS attempts to pick his way through the economic mumbo-jumbo

CAN'T tell your PEPs from your ISAs? Bewildered by talk of CAT standards and Redemption yields? Stumped by the concept of a With-profits fund? Join the club.

Most British people find the language of everyday financial dealings more difficult to understand than French, Shakespeare - or even programming the video, according to a new survey.

When presented with an Individual Savings Account brochure, a French menu, a video recorder manual, a Shakespeare play and a car manual, 26 per cent of people said they found the ISA leaflet the most difficult to understand, the survey revealed.

It's no laughing matter. Because our inability to make head or tail of complex financial terminology may be hitting us where it hurts most - in our pockets.

The survey, commissioned by personal finance website The Motley Fool, has found four out of ten people are put off investing their money because of financial jargon.

Almost half of those questioned said they did not have a clue what PEPS and Maxi ISAs were.

And despite the introduction of CAT standards to guarantee clarity over charges, eight out of ten people did not know what they meant.

Women found financial jargon more off-putting than men (42 per cent compared to 37 per cent), while nearly half of people aged 18 to 24 said they were discouraged from investing by complicated financial literature.

More than eight out of ten people admitted they did not even understand the difference between a tax-free ISA, and an IFA, or Independent Financial Adviser, the survey revealed.

That didn't stop 39 per cent of people questioned going out and investing in an ISA. But did they really know what they were getting?

Motley Fool, which is calling on the financial services industry to use plain, jargon-free English, believes not.

David Berger, head of Motley Fool UK, said: "People are quite capable of making informed decisions about their own money - but how can they do this if they don't understand what they are reading?"

Gerry Gray, partner in York firm Grosvenor Financial Consultants, has similar concerns.

He says too often financial professionals use the same jargon with clients that they use when speaking to each other - and their clients simply don't understand what they are talking about.

Mortgages are a classic example, he says. He's frequently asked for advice by people caught out by redemption penalties in the small print - which effectively prevents them moving to another mortgage lender.

Pensions are also a minefield, he says - he recently had to ring a pension company on behalf of one of his clients because even he could not understand the financial gibberish in which the pension documents were written.

Gerry says he is all for plainer English - and also believes people should study basic finance at school to help them cope when they get their first mortgage or want to make their first investment.

"It's a nightmare," he says.

"I feel so sorry for ordinary people.

"All this jargon means that people sometimes make inappropriate investments, because either their adviser doesn't understand what they want, or the investor doesn't understand what they are being given."