18th September 2015 at 3:30pm
When Baroness Ros Altmann, the minister of state for pensions, spoke about dramatic changes in society this week, she highlighted the challenges we face as our population ages.
By 2022, she explained, there will be fewer under 50s and an extra 3.7 million people between the age of 50 and State Pension age.
Yet as people reach their 50s, fewer people stay in paid work – and the age when people are entitled to their State Pension is rising to cope with the fact that there are fewer younger people in work to sustain the ageing population.
Times are changing; we need to move with them
What this all means is a big challenge for the future: how do we make pensions work?
Auto-enrolment – where people automatically join their company pension scheme – is already making a difference. More young people are saving for their future.
What the statistics show is there’s a need to do more to make sure as many people as possible save so that they can have the retirement they want. And we’re all living longer, on average, so the need to have enough for what could be a 30-year retirement is now a very real consideration.
If you’re in your 50s, 60s, 70s or 80s and want to continue working, you should be able to because you want to, whether that’s full-time or a few hours a week, not because you need to.
With pension freedoms giving the over-55s more choice around accessing their pension savings, having the financial freedom to do what you want, when you want, is something many of us dream of.
It’s all about having enough savings to give you choices about how you want to live your life. Whether you want to retire at 55, travel the world for a few years, or work part-time; being able to rely on your pension savings can give you the financial freedom to make the choices you want.
A pension is an investment. Its value can go up or down and it may be worth less than you paid in. Investment returns aren’t guaranteed. The value of your investments can go up or down and may be worth less than what was paid in.
This blog and any responses are not financial advice.