State pension age could rise faster than expected

Enables IFA’s in Bishops Stortford are all too aware that the state pension age has already been going up on a gradual basis from its longstanding levels and millions more working-age people may have to wait until their 70s to retire as more official reviews of the state pension age come into play.

A new consideration is underway as to whether to change the state retirement age from April 2028, the point at which it will have reached 67 for men and women, potentially affecting people under the age of about 55. John Cridland, the former director general of the CBI, was appointed to act as the independent reviewer of the pension age and will look at whether the pension age should continue to be linked to rising life expectancy.

The Office for Budget Responsibility has already forecast that on current life expectancy trajectories the state pensionable age could reach 70 by the mid-2060s, but some have warned that it could come even sooner than expected. Tom McPhail, the head of retirement policy at the financial services firm Hargreaves Lansdown, said: “We fully expect state pension ages to go up faster than currently planned, and those joining the workforce today are likely to find themselves waiting until their mid-70s to get a payout from the state system. “Whatever decisions they make, the government needs to make sure they communicate them very, very clearly so individuals can plan their retirement savings with some certainty about what they will get from the state, and when they will get it.”

If you are worrying about your pension then why not get in touch with our team at Enable, we will help you to review your current pension plan.

Source: BBC

Issued by: Enable Independent Financial Life Planners • 
25c North Street, Bishops Stortford, Herts CM23 2LD • Telephone: 01279 755950 - Fax: 01279 657339
Enable Independent Financial Life Planners is a trading style of Enable Independent Limited is authorised and regulated by the Financial Conduct Authority.
It is important always to seek independent financial advice before making any decision regarding your finances. If you would like any assistance, please contact us.
NOTHING CONTAINED IN THE ARTICLES SHOULD BE CONSIDERED AS GIVING INDIVIDUAL FINANCIAL ADVICE

Are you part of the lost generation of savers?

Recently Enable’s IFA’s in Bishops Stortford noticed articles drawing attention to “A lost generation of savers aged 35-to-45” - some believe that are going to be the worst prepared for retirement.  This is the swathe of people stuck between “millennials” and “babyboomers.” Babyboomers have retirement sorted out owing to historically more generous workplace pensions and defined benefit (DB) schemes that pay out a multiple of years worked and a percentage of final salary as income for the rest of an employees’ life. And the younger generation of millennials are saving early thanks to auto-enrolment, so they should be in a strong financial position when they reach retirement with decades of savings behind them.

But Holly Mackay of Boring Money, has warned that those aged 35-to-45 are not saving enough considering the reduced amount of time they have until retirement. Her survey found that of the 35-to-45 age group, just 22% were saving into a private pension. ‘There is a lost generation of 35-to-45 year olds who are rubbish with money,’ she said. ‘You have the swotty millennials who are saving money and planning, and the babyboomers, [but those in the middle] assume that the job is done because they are making workplace contributions but the contribution rates are too low.’

Jamie Jenkins, pension expert at Standard Life, agreed that there is an emerging ‘lost generation’’ he also said, “that prior to auto-enrolment, the Department for Work and Pensions estimated 10 million were not saving for retirement and now, despite more people saving, there are between 10 million and 13 million people who are not saving enough even with auto-enrolment.”  Enables IFA’s in Bishops Stortford know that the only solution for those who fall into this gap between the two generations is to save more into workplace pensions now, top up later, or work longer, we can help you talk through saving more.


Issued by: Enable Independent Financial Life Planners 
25c North Street, Bishops Stortford, Herts CM23 2LD
Telephone: 01279 755950 - Fax: 01279 657339
 Enable Independent Financial Life Planners is a trading style of Enable Independent Limited is authorised and regulated by the Financial Conduct Authority.
It is important always to seek independent financial advice before making any decision regarding your finances. If you would like any assistance, please contact us.
NOTHING CONTAINED IN THE ARTICLES SHOULD BE CONSIDERED AS GIVING INDIVIDUAL FINANCIAL ADVICE

'Comfort' pension level is £15,000, says study

Enables IFA’s know that one of the hardest things to think about when you are young is saving for a pension.  But one of the surest things to do to make sure you have some savings for retirement is to start early.  A recent industry report suggests that when you are planning for retirement your should try and plan for an income of at least £15,000 a year.  It suggests that once people reach that income level, they begin to feel more comfortable and more financially secure and that that sense of wellbeing jumps significantly once retirees earn between £15,000 and £20,000 a year, including their state pension.

Interestingly enough the £15,000 contentment threshold seemed to apply however many people there are in the household.  A report like this really does help give a much more clear idea of how much people need to save for the very basics in pensions for retirement to top up state pensions.  The revised state pension is expected to be worth at least £7,500 a year when it comes in in April 2016.

Nest - a non-profit-making organisation which supplies pensions under automatic enrolement- has recently produced some tips for saving into a pension.  It claims that if a 30-year-old worker replaced a takeaway with a home-cooked meal at least once a week, they could save £12 a week.
If all of that was paid into a pension, it could build up to a pot worth more than £50,000.  Makes you think about what you might be frittering away if you want to start planning for your pension early Enable’s IFA’s are here to help.

Issued by: Enable Independent Financial Life Planners
25c North Street, Bishops Stortford, Herts CM23 2LD
Telephone: 01279 755950 - Fax: 01279 657339
Enable Independent Financial Life Planners is a trading style of Enable Independent Limited is authorised and regulated by the Financial Conduct Authority.
It is important always to seek independent financial advice before making any decision regarding your finances. If you would like any assistance, please contact us.
NOTHING CONTAINED IN THE ARTICLES SHOULD BE CONSIDERED AS GIVING INDIVIDUAL FINANCIAL ADVICE