to think most people will work till they're dead and won't see retirement age?

If parents could be persuaded to save money in their daughter's pension while those daughters are still children that would be of much greater value.

Very good point. When our daughter got her first paying job at 18 she became eligible to contribute her wages into a tax advantaged retirement account called a Roth IRA. You can only pay into a Roth with earned income. So she deposited most her pay and we replaced it dollar for dollar so that she could keep access to the cash. She's already investing for retirement at age 19.

[quote Kazzyhoward]**@80sEyeShadow* My advice to any and all young people, women in particular, is to 'front load' your pension - pay in as much as you can reasonably afford when you are as young as possible.*

Easier said that done when they have student loan repayments, historically high housing costs, and the prospect of tax rises on the horizon to pay for covid. The "squeezed middle" are rapidly extending to the "squeezed young" too![/quote]
True, yes. Though 'front loading' doesn't have to be huge, even a small amount makes a big difference later on.

My post, in part, was based on the gender pension gap. Unless there is a huge societal shift in the way that we treat expectant mothers and those with children financially, it is women who will bear the brunt of pension poverty.

It was only a generation ago that parents often saved for their daughter's wedding. If parents could be persuaded to save money in their daughter's pension while those daughters are still children that would be of much greater value.

In the US, what we are taught is that the state pension (aka Social Security Retirement Benefits) is one leg of a three-legged stool, the other two being employer pensions and personal savings. And the elderly are the most affluent age group in the US.

The Graying Of Wealth

Everyone should work to provide for themselves. If you save while you’re working when you’re younger, you can live off that when you’re older. That’s called a “pension”.

If you don’t save at all, you’ll need to fall back on the state’s safety net, the amount of which and age at which it can be drawn depends on what the state can afford. That’s called the “State Pension”.

If you want to retire earlier than State Pension age and/or receive a higher income than the State Pension provides it’s up to you to save for it. No one else. If your occupational pension won’t be enough, save more.

My dad didn't see retirement. Mum is now 80 having been a widow 20 years.
It affected me. My retirement savings represent 10 good years of holidays and travel. State pension at 67 will cover basic Bill's. My plan was to travel extensively in my 50s. Not happened yet.

Who wants to be operated on by an ophthalmic surgeon who's 70?

Could a 70yo be a hairdresser, on their feet 8hrs per day? Or work in a factory on a production line lifting/bending, etc., including shift work?

What about a roof builder? It's not going to be safe for the elderly to be climbing around on tall buildings.

My normal retirement age is 68 for state pension and most of my work pension. I really can't see me teaching until then, whose going to want teachers who are nearly 70?

Looked at my pension a few days ago, apparently I could have arranged additional contributions to bring my retirement age down to 65, but needed to have arranged that in 2015 and I had no idea.

I'm with you all the way, @Iamthewombat

But expect the"race to the bottom" (yawn) gang to arrive any time now.

Of course, it's never a race to the bottom the other way, when private sector employees can only dream of a pension scheme that comes anywhere close to the ones they're helping to fund through taxes.

Let’s not disappear down a WASPI rabbit hole. I will be forced to link to the thread last summer where I conclusively won the argument.

I gave up work at 60, six years ago, so that I could help care for my grandchildren, as I always planned to. I’ve just made my state pension age this year, so it’s been challenging financially for DH and me, and our savings are shot - sadly this will probably impact more on our adult children than on us.

I’ve never for one moment regretted the decision to stop working though and help them when they needed it. I’d never have got back those six years with the grandchildren if I’d carried on working. And we’ve had time to take life at our own pace, and enjoy our interests and family and friends. Too many of whom are developing health issues that impact on their quality of life. Life’s short - or at least, healthy, enjoyable life is for most of us.

Aha! It all becomes clear. I suspect that you are in the ‘Back to 60’ WASPI camp. In which case, I won’t expect a reasoned argument.

You’re confusing two groups. WASPI, asking for some form of bridging payment for the women most affected by the sharp rise in pension age, and Back to 60, who want just that.

Plus I assume people get housing benefit in old age if you need support for rent. And other benefits. I had DC at 44 too - they will at least be grown up when we reach 'retirement' age - whatever that looks like.

@Tessabelle74 also we arent yet seeing the impact of all people having a state retirement age of 67. A PP commented that we will end up with more people retiring for health reasons between 60 and state retirement age.

One of my concerns is the risk for people being left with a pension pot to manage but not necessarily the skills to manage it with. Individuals being put under pressure (family or partner) to release the maximum in cash to be squandered. It's one thing to use that money to clear debts but a very different thing to blow it on a 'once in a lifetime' holiday for all the family.

You're welcome. There's a lot more detail about the RI pension reforms online if you google it.

One thing that was unusual was that the changes affected current plan members. Often these reforms only impact new hires, creating pension "tiers". Limiting the changes to new employees does very little to make the plans more solvent, especially when they are billions in the hole.

They also did some interesting reforms, like capping pension payments at 150% of the average household income in the state. This kept people from gaming the system by working massive amounts of overtime in their last few years on the job. It also seems fair to most people.

Thanks for that link, really informative. This bit made me sit up and pay attention:

A report commissioned by Raimondo showed that, in 2011, the $14.8 billion pension system had more than $6.8 billion in unfunded liabilities. In addition, taxpayer contributions to the funds had more than doubled from $139 million in 2003 to $303 million by 2010.

Christ on a cracker! That is a great example illustrating why we can’t all give up work on generous government funded schemes at age 60.

Some state level government pension plans in the US have been reformed because they were so generous they were literally going to run out of money. Rhode Island is a good example:

Rhode Island Gov. Raimondo, Biden’s Pick for Commerce Secretary, Is a Pioneer of Public Pension Reform

They wound up with a hybrid DB/DC plan. There was a lot of moaning about it at the time but the alternative was no pensions at all after the plan went bust. The fact that President Biden has selected Raimondo as Commerce Secretary means that there will be more of this to come.

@Lweji CURRENTLY the average age is 87. Once we all stop retiring at 67 and retirement age pushes to 75, see that start dropping!

[quote pinkflamingo112]@Iamthewombat no wouldn't rather work longer thanks!! when you sign up to the pension you don't expect them to change it without consultation as they did on this ,we pay a higher % now into it & most worn get their full pension as will take it early as unable to work at 67 /68. why is unfair on lowered paid people?i don't think working without payrises & paid lower than other jobs is a reason i should work longer .[/quote]
No, of course you wouldn’t, but that is the choice that had to be made.

Either the (very expensive, for the taxpayer) NHS pension became more affordable - by increasing both the retirement age and the contribution rates - or it became a defined contribution pension, which is far less generous.

Your union leaders and representatives chose the former. Of course they did. There was no alternative.

What COULDN’T happen was for members of the NHS scheme to continue to enjoy the best of all worlds. Pension schemes, especially those backed by the taxpayer, can vary terms whenever they want. They aren’t sacrosanct.

The NHS pension, along with other public sector schemes, was becoming unaffordable and, as I noted upthread, it would not be fair for low paid people who were not a member of this extremely generous scheme to fund very expensive benefits for people who were members.

Example: imagine somebody works in a care home. She might earn £16k a year. She will pay tax on that. She won’t be able to retire on state pension until she is 67 (let’s say that she is 49, like me). Why should that low paid worker’s tax revenues pay for NHS workers of the same age to retire at 60 on a generous taxpayer-supported pension rather than at 67, the same age that she will retire? It is manifestly unfair.

You must see that, surely?

Even with your later retirement date and increased contribution rates, you are getting an absolute bargain with the NHS pension scheme. Look up annuity rates and calculate how much you would need to set aside to buy the same index-linked pension payments from age 67 until the day you die. You will be very surprised. The contributions you have made throughout your working life won’t even touch the sides.

@Draineddraineddrained I agree, I love my job but love my time off as well and will definitely my be happy to retire in c.30 years time.

So many books to read, places to visit, it sounds incredible.

I will never understand people who say retirement looks boring. Just never. Hours and hours to read, walk, watch, cook, potter around doing whatever you like??? How could that ever be boring?

I always secretly wonder whether these people are the grown ups children who are never taught to amuse themselves turn into

@Iamthewombat no wouldn't rather work longer thanks!! when you sign up to the pension you don't expect them to change it without consultation as they did on this ,we pay a higher % now into it & most worn get their full pension as will take it early as unable to work at 67 /68. why is unfair on lowered paid people?i don't think working without payrises & paid lower than other jobs is a reason i should work longer .

I retired at 60. Then went back as a consultant 2 days a week until I was 65. There is no way on earth I could could do the job now I am 70. My job was very demanding as a Catering Manager over a number of sites. On my feet 12 hours a day.
It made me realise I was old when I helped my friend to do a big spring clean last week (she is a hoarder) I was knackered.

Also, younger people might opt out and not see the point of paying into a workplace pension they can't have at all till 75. Why should it be all or nothing? Why not offer flexible retirement and gradual downshifting in working hours and gradual top-up from the pension as a transition from age 55 or 60?

You can do this already. You are conflating the state pension, and public sector occupational pensions linked to it, with private pensions and pensions offered by non-public sector employers.

Right now, if you open a SIPP or another type of private pension, you can start to draw down from the age of 55, although that might increase a bit.

There are very few workplace defined benefit schemes left, outside of the public sector, but quite a few schemes offered by private sector employers allow you to retire before state pension age. You take the financial risk though.

So it is perfectly possible to combine being a member of a scheme linked to state pension age with private pension savings that you can draw down earlier, or with pension savings from a separate employment. If you decide that the benefits of a public sector DB scheme don’t justify the longer wait to access them, you can leave and join a private sector employer with a money purchase scheme instead. Less generous but you get your money sooner.

Maybe there should be some provision for the state pension to be paid early to those with a terminal illness? Not helpful in cases of sudden death, except perhaps a lump sum to their next of kin based on contribution record? Can't see the Tories going for that!

In the US if a spouse dies before collecting their social security pension the surviving spouse gets it, on top of their own. Anything further would destroy the actuarial basis of the system. It's designed on the basis that some won't collect their full benefit, or will die after only a short time collecting benefits. In the US, the whole thing is structured as insurance, not an individual account holding money that is specifically "yours".

They've also raised the full retirement age here. For me it's now 66.5 years. You can collect as early as 62, losing 8% for every year you claim before full retirement age. If you postpone taking benefits, the amount you collect rises by 8% for every year you hold off. That works up to age 70, then no further increases are given if you don't claim benefits. Only about 6% of people wait until age 70 to claim.