How we can all age confidently
Posted on Sep 10, 2019
Why should I embrace the ups and downs of stock markets?
- Oct 21, 2019
Top three tips for...-deposit savings
- Oct 15, 2019
Is care leaving you confused?
- Oct 10, 2019
In a recent policy document entitled Ageing Confidently the Centre for Social Justice (CSJ) argued that the state pension age should rise to 70 by 2028 and to 75 by 2035. The think tank explained that this would boost the economy by keeping older generations in work for longer.
Established in 2004, the CSJ is an independent ‘think tank’ that studies the root causes of Britain’s social problems and addresses them by recommending ‘practical, workable policy interventions’.
The CSJ explained that Britain is witnessing a significant demographic change, with an increase in life expectancy and a decrease in the fertility rate meaning that older people make up a growing proportion of the population. By 2035, over half of all adults in the UK will be over 50 years of age.
The policy document says: ‘Ensuring that this growing proportion of older people continue to make an essential contribution to our economy as workers, carers, taxpayers and volunteers is an important question for public policy’.
The CSJ says that one of the results of an ageing population has been an ageing workforce. In the UK, employment rates have increased for those aged 50-64 years old. That said, it notes that there is a silent cohort of over 50s in the UK who are not working but would like to, with the over 50s facing ‘significant barriers’ in the world of work and that not all older people have equal access to employment.
The paper goes on to discuss how working longer has positive impacts on health and wellbeing, bringing structure to life, important social networks and a sense of purpose and self-esteem.
The CSJ says that policy must do more to retain and support older workers in the workforce, with a recommendation that GPs should be better trained in occupational health, while people aged over 55 should be treated as a priority group and given tailored support. The right to request flexible working should also be strengthened.
The CSJ also recommends that employee tailored holistic mid-life MOTs should be implemented by employers to discuss wealth, work and health. Rather than being understood as retirement support, this structure should be conceptualised as a support tool for older workers to enable those that want to, to continue working.
The CSJ recognises that the fiscal pressure related to an increase in welfare spending in the form of the State Pension in combination with a decrease in the working population presents a significant fiscal challenge.
Its recommendation is that the State Pension age (SPA) should better reflect the longer life expectancies that we now enjoy and be used to support the fiscal balance of the nation. The SPA in the UK is set to rise to 66 by 2020, to 67 between 2026 and 2028 and to 68 between 2044 and 2046. The CSJ proposes accelerating the SPA increase to 70 by 2028 and then 75 by 2035. This, it says, would ‘significantly improve the country’s projected fiscal position’.
In the conclusion, the organisation states: “While this might seem contrary to the long-standing compassionate attitude to the older generation that have paid their way in the world and deserve to be looked after, we do not believe it should be. Working longer has the potential to improve health and wellbeing, increase retirement savings and ensure the full functioning of public services for all.”
While the focus of the report from the CSJ is on the State Pension, it is interesting to look back in history and discover that it was never meant to be somebody’s sole way of financing their latter years, so getting our own finances and pension provision in hand is key and growing increasingly important.
With an increasing number of us living up to 30 years post-retirement, it’s worth being as well prepared as possible.
At The Goodman Partnership – pension planners Tunbridge Wells - we can help you to understand if your lifestyle needs can be met in retirement and how the different options of drawing benefits compare.
Give us a call on 01892 500600 or visit our "Retirement Planning" page.