The Government has appointed John Cridland CBE to lead an independent review of the state pension age. Pensions minister Richard Harrington says: “People are living and working longer than ever before, that is why it is important we get this right to ensure the system stays fair and sustainable for generations to come.”
The Pensions and Lifetime Savings Association says it does not want to see the state pension age increased any more because it would disadvantage groups of people with lower than average life expectancies. The PLSA says the UK is already set to have – at 68 – the highest state pension age of any developed country.
However, PricewaterhouseCoopers suggest that someone born today is unlikely to receive their state pension until they reach 77 and their children will be working into their mid 80s; basing their projections on the rate the state pension age has been accelerating and analysis of future life expectancies. They take into account recent figures, from the Office of National Statistics, that one-third of babies born in 2012 are expected to celebrate their 100th birthday.
What does all this tell us? Successive Governments can wrestle with this all they want and well-meaning associations can put their two-penneth worth in but when number crunchers as credible as PwC are producing information like this then I firmly believe the only solution is to take control and not be reliant on state or employer.
That’s certainly what I’ve told my kids because I feel that otherwise, a retirement age of 68 is wildly optimistic. I know it’s difficult with other financial commitments but the earlier people can put something aside for old age, even a small amount to start with, the better position they will be in to control their own retirement.
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