‘I don’t get excited when I hear EITC. Do you?’
This is a line from the late, lamented West Wing. The acronym EITC refers to Earned Income Tax Credit, a refundable tax credit for low to moderate-income working people. One of the characters, Charlie, is trying to fight for it, only to be told by Annabeth that this won’t be easy because it doesn’t have a catchy name like ‘Marriage Penalty’ or ‘Death Tax’.
She’s right. Who would understand EITC, let alone get behind it? It’s the same on this side of the pond. Financial phrases like AER (Annual Equivalent Rate), DB (Defined Benefit) and OEICs (Open-Ended Investment Companies) don’t exactly roll off the tongue, let alone lend themselves to easy interpretation.
And the more opaque something sounds, the harder it is to sell, despite the fact that many financial products and services benefit savers and investors.
Thankfully, the City watchdog agrees that, in some cases, too much incomprehensible jargon has been used by investment companies and advisers when communicating with their customers. A
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