Tag Archives: money matters

Financial resilience as we approach retirement: is it too late to save?

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This question was the starting point of Age UK’s first Financial Services Commission summit event on 6th December. It arose from forthcoming Age UK research which suggests that although those coming up to retirement are often seen as a wealthy and resilient generation, all but the most affluent face considerable challenges, and there is a widely prevalent feeling of uncertainty which deters saving.

The Commission – jointly chaired by Tom Wright, CEO of Age UK and Dr Alexander Scott CEO of the Chartered Insurance Institute – was set up to examine how to improve financial resilience in later life.

At the event (hosted by BlackRock, the investment management firm) Tom challenged senior figures from the financial services industry, consumer and regulatory organisations to give their recipe for improving financial resilience among the group approaching retirement. The debate ranged between those who feel we need to build trust in the financial services industry and those who pointed to supply-side failures. So far, so unsurprising. But there was a new mood of optimism and – dare I say it – realism. Continue reading

Why we need the triple lock

440x210_pound-coins In a surprise announcement at the start of 2014 David Cameron, the Prime Minister, said that maintaining the ‘triple lock’ for the basic state pension will be a key part of the Conservative’s next election manifesto. This would mean that, at least until 2020, the basic state pension would be increased annually by the rise in prices, earnings or 2.5 per cent – whichever is higher. In response the Labour leader Ed Miliband has also said he is committed to the triple lock.

Reaction has been variable. Some newspapers immediately suggested this would affect other benefits such as the winter fuel payment – the Daily Mail’s headline was ‘Turmoil over OAP benefits’. The Independent welcomed the announcement but said it does not go far enough pointing out that the basic pension is still only £110 a week.

Alternatively, others have focussed on what this means for younger people with the Intergenerational Foundation stating the move is unaffordable and ‘betrays’ the younger generation. Continue reading

Age UK establishes commission on financial services

We are “woefully underprepared” for our ageing society. That was the conclusion of the House of Lords Select Committee chaired by Lord Filkin earlier in the year.

Central to that is the fact that people just aren’t saving enough for retirement and their later life.   New polling Age UK commissioned found that just under a quarter of people aged 50-64  -  those rapidly approaching state pension age  -  think there’s no point  saving.  Worryingly, that’s not because the majority have

Tom Wright, Chief Executive of Age UK and Co-Chair of the Financial Services Commission

Tom Wright, Chief Executive of Age UK and Co-Chair of the Financial Services Commission

already made provision for their future.  More than a quarter said they were worried about having enough to live on. Only 15 per cent thought they had saved enough already.

We also frequently hear from older people about the problems they face with money matters, and the lack of solutions that really work for older people. While auto-enrolment is a massive step forward, it will not have time to reap its full benefits for people close to retirement.

That’s why we’re launching the Financial Services Commission – which will be co-chaired by Tom Wright CEO of Age UK and Dr Alexander Scott of the Chartered Insurance Institute. Launching on December 5th, it will be take the form of a series of three summits in which we will work with key industry leaders and consumer experts to examine how to improve the “financial resilience” of older people – their ability to weather the challenges that might lie ahead. It will culminate in June next year with the publication of a roadmap of actions that regulators, government and industry need to take to help keep future and current pensioners financially resilient. Continue reading

A fair state pension for all?

This blog was contributed by Hannah Pearce, Age UK’s joint Head of Public Affairs.

Every few years the government announces its intention to fundamentally reform the pension system once and for all to ensure it is fair and sustainable for current and future generations. Each of these attempts is made with good 200x160_moneyintentions and with the hope that the changes will last. However a few years down the line the next government decides it’s time to try again. I’m already working on my fourth pension bill since beginning work for Age UK.

Successive governments are compelled to grapple with the pensions system to catch up with societal changes such as increases in life expectancy, changes in working patterns and to counter structural unfairness. For example several of the state pension reforms in the 2007 Pensions Act sought to ensure that the pension system better reflected the lives of women who often have some time out of employment caring for children, older family members, or working part time.

The compelling reasons for reform under the current proposals were to create a system which is intended to be fairer, simpler and more sustainable. Under the single tier system individuals will receive a state pension based on their own contribution record of up to £146 in today’s money if they have a full record of 35 years contributions. Continue reading