The Government has recently announced that the number of qualifying years of service required for full state pension entitlement will be increased by five years from 30 to 35. The state pension age is also on the up. By 2018 the age will rise to 65 for women, and by 2020 66 for both men and women. It is predicted that between 2026 and 2028 the rise will up again to 67. The government have admitted that yes, state pension age is becoming partly reflected on life expectancy. This is Money reported that if the improving mortality rates continue as they have been, ‘a seventeen-year-old A-Level student in 2011 might face a 60-year working career before he or she can retire.’ So, the longer we live, the longer we work.
Furthermore, figures from February 2012 by the Office for National Statistics conveyed that the average retirement age rose to 64.6 years from 63.8 and to 62.3 years from 61.2 for woman between 2004 and 2010. It is suggested that this is due to a worry that after retirement, a pension alone will not enable pensioners to sustain their current way of living. At the end of October 2012, The Telegraph reported that ‘according to the National Association of Pension Funds (NAPF), 48 per cent of all workers are planning to work in paid or volunteer work beyond the state pension age.’ They then go on to say that ‘Eight in ten of the people choosing to stay in paid work will do so because they will not have enough money to stop working…’, as the new flat rate state pension of £144 which equates to £7,488 a year, nowhere near enough to maintain even a basic living standard. The minimum wage alone equates to nearly double the flat rate pension. With figures like this, how can one look forward to a comfortable retirement? Age really is on the up!
By Holly Hereford