To think that a lot of us will be in trouble when we retire...

[Fleetheart]

This generation seems very unlike the previous ones in that we take out loans for everything, buy holidays on credit, kitchens on credit, new clothes etc etc. And pension schemes are getting less and less generous. And most of us don’t understand them anyway. I’ve always earned well, but have split up from partner, so still have s lot on my mortgage, no savings, and really not very much in my random pension schemes most of which are money purchase schemes and won’t pay a lot. And I know many people of my age (mid 50s) who have no pension at all. And meanwhile the govt is being less and less generous. What will become of us all?

My plan is to die young (relatively) like my parents and my maternal grandparents. I take after that side of the family so I think I will be ok.

Husband also has dodgy genes. I reckon we are ok

I don't see how this would be the case. We already have people forced to sell their homes to pay for care whereas people who have no homes still get their care paid for, from what I understand.

I don’t think this is the exact case in all boroughs. I have heard plenty of stories of old people having to move to cheaper nursing homes once their own money has run out. You’re very lucky if your elderly relative is in a very good nursing home which is fully paid for by the state.

Re my suggestion there would be riots, I was really taking about the state pension being removed, not payments towards nursing home care.

please ignore, I've just had a google and it seems that that is the case, which is nice!

Slightly annoying are the next three years, where I worked part time enough while studying to make partial contributions, but not enough for it to count as a year towards the 35 - yet presumably if I hadn't worked/studied and claimed three years of JSA instead I would have those three years, but hey ho!

@Withnail
The money you pay is supporting the pensioners of today. The gov are not saving our individual pots of money so that we get It back on retirement. It doesn't work like that.
Hence the panic over whether there will be enough young people contributing in the future to sustain the whole system.
That's why i dont want to rely on it.

My paternal grandparents & maternal grandparents are a good example of where it's all gone wrong, economically.. I loved them but if my family are typical, I've no idea how we're solvent!

Maternal grandmother: housewife, no paid employment, raised 3 kids, didn't pay any national insurance... Lived to 97 with complex health needs requiring about 30 years of intensive care. Bed bound.

Maternal grandfather: retired at 55, lived to 88. Started working at 15 but still only 40 years of work to a 33 year retirement.

Paternal grandmother: odd "cash in hand" jobs (cleaning, ironing) now and then, housewife other times, raised 4 kids. Lived to 89. Needed round the clock mental care (Alzheimer's) for years before physical care also needed in the last 15 years.

Paternal grandfather: worked in a factory, again from very very young age, helped on farmwork before that as a child.. but retired in early 50s from ill health, passed away in late 80s, in hospital, after needing care in a care home (house not adaptable for wheelchair).

If you consider the Idea of "paying in" so that you can later get support needed.. well, my generation simply won't get that level of care,the numbers don't add up.

Our welfare state wasn't designed for 30 years of complex care provision for most people, we can already see it failing and yet none of my family had paid into anything other than a very basic personal work pension..so they had huge council/NHS support plus a small personal pension.. the saving grace was that both granddads had their "defined" pots (the kind where the council ask for monthly payments but you get a guaranteed final pension, not the shit modern kind I have where you don't have a guaranteed monthly pension).

flapjack

Omg really!? I had no idea 😳
So that's why people are always on about the ageing population as in, years to come, there will be more old people that young working people so won't be enough to go round? (Not to mention health costs)
Holy shit.
So now what do I do? Save as much as possible? Into what?
Like I said, I'm 33, work ft single parent, I went and pay into a nest pension.

Shit 😳

I hope that we will have a UK version of Dignitas. If not then I plan to go over to them in Switzerland. I say "plan", it's very hard to get accepted by them, you need to be terminally ill, not just 'old' - you need a valid reason. There is another dignitas style place, also in Switzerland, which I think is a little more lenient, but generally speaking I plan to sort it out myself. I've done some fairly extensive research, and while sometimes I'm comforted by my plans, at times it scares me a lot too.

I live quite frugally, don't have any children, and the state pension will be more than enough for me. But the problem is will it still exist by then..

I'm 35, don't own any property, mental health issues have prevented me from working full time for quite a few years. I feel it's too late to sort anything out re a pension or any significant savings.

"Our welfare state wasn't designed for 30 years of complex care provision" may be one of the most truthful and accurate sentences written on MN. Nor was the NHS designed for it. In the 1940s, it was actuarially forecast that most men would live for two or three years after retiring from hard manual labour, and women were expected to live a little longer.

I understand the boon that the NHS has been and that medical frontiers have expanded, but there is (inevitably) a trade off. That people who are only kept going via costly cocktails of medication and intervention is unsustainable. Eventually, the wish to keep granny going past her expiry date will have to be tempered by a more reasoned approach.

And, if I can broach another shibboleth, the solution is at hand in the obesity crisis. The refusal to eat sensibly and moderately, and to take proper regular exercise is going to exact a toll on the population, measured in premature deaths and long term ill health. Life expectancy is already declining and statistically speaking, this is the get out for the pension system.

@Withnail and @Black cat.
You are young yet so dont panic too much . Why not discuss it with an adviser and see what they suggest. Even a few pounds a month saved in an isa or high interest account is better than nothing and you have 30 yrs for it to accumulate.
Ten pounds a week is over 500 a year x30 yrs is a little nest egg and a bit of a buffer. And interest will add a little bit on top ( not much in this day and age I grant you ).

PS I think sticking your head in the sand is the v worst thing to do. You may not be able to save much but do save what you can anyway.

Nearly every single nursing home has a mixture of state paid and privately funded patients. It is only the most expensive homes that only have private patients.

I think we shall have to let (force) doctors make hard decisions about care rationing in the next decade. How hard do we try to resuscitate cardiac cases over retirement age? What cutting edge treatments will be available to people with terminal cancers, above and beyond palliative care?

Like it or not there is an economic dimension to these judgements that society needs to confront, rather than simply being woolly. When my DH arrested in an ambulance 9 months after his 50th birthday, I was grateful that he was brought back to me. Since then, he and his business have generated a lot of jobs and paid roughly a million in taxes. My 90 y-o DMIL (of whom I am very fond) has been infirm, a bit demented, heart condition etc. for a rather shorter time, but has contributed precisely nothing to benefit anyone economically or socially in her declining years. She isn't happy, doesn't get out and has stipulated no medical interventions, but she is protected from viral infections and medicated for everything from osteoporosis to high cholesterol.

All of which, I acknowledge, is anecdata.

The Government will always have to provide for people too old to work who do not have enough money to support themselves. It used to happen 200 years ago, so its not going to disappear. The state pension may get smaller so that all it supports is very basic living, but it will not disappear.

Riding round on buses to keep warm?

I think owning your house and paying off your mortgage makes life so much easier in later life. I have a 4 bed house worth £600k, I have 5 years left to pay off the mortgage and my mortgage payments are £500 a month if I was renting my house it would be £2000 a month. Buying and paying off your mortgage ASAP is as important as a pension. My adult children also have a home for as long as they want.

@jennymara, what happened 200 years ago was that the indigent and infirm ended up institutionalized in workhouses, eating gruel.

@Hazza000 I am not in the MN well off middle class demographic. I can live cheaply if I have too.
And employers are never going to employ most people till they drop. In some very poor countries the Government employs those who can not work properly to do jobs. They do some work, but are not expected to be anywhere close to as productive as ordinary employees. I can't see that happening here. And the reality is that increased care for premmie babies and chronic health problems means more people survive into old age, but are not well enough to work.

It's lovely to read about the faith and trust that "government will fund it". You are providing the funds via taxation. You are entitled to a view on how the money is spent!

@XingMing I am well aware off that. And many working class people 200 years ago lived in squalor and struggled to feed themselves. But even in that environment, the Government did not leave old people to starve on the street.

@XingMing so you would leave old people to either beg or starve?

Actually @Jenny, I think you'll find that old people were regularly left to starve unless there was a well run and funded poor house or families were able to provide. It was closer to a Mumbai slum then than we like to admit.

@Withnailandaye

Although you have to pay NI to qualify for a pension and certain other benefits, in practice it is just tax. It goes into the government kitty and the government of the day decides what to spend it on. The government of tomorrow may decide differently.

You would think that, in some shape or form they surely have to honour the generations who have paid NI. However, when you consider that somebody who is in receipt of a full state pension today but has no private pension qualifies for pension credit to top their income up, the government is already admitting that the basic state pension is not enough to live on. The future one will be higher, however - although you have to wait longer to get it.

What should you do? You should save.

You could save into an ISA, in which case there is no tax on either capital growth or income.

If you save into a pension, you get an immediate 25% boost to the amount you are saving in the form of tax relief. Even if you don't pay tax!! And in most cases, your employer will contribute as well, which is basically free money for you. Pensions also have the advantage that you can't touch them until you are 55. Admittedly it's not as flexible as having money in an ISA, but it protects you from the temptation of spending it too soon.

I don't know what a nest pension is, sorry. I suggest you do some reading... have a look at www.moneysavingexpert.com/pensions, loads of good basic information there, try and get your head round the main concepts. Then, as suggested, see an adviser who can look at what you've currently got and translate that into what your income is likely to be in retirement. Then they will make suggestions about what else to do.

Also read up about the miracle of compound interest. The earlier you start saving, the more you will get out for the same monthly contribution. And it makes a BIG difference.

No @Jenny, I'd not leave old people to beg or starve. I'm not heartless. But I think there need to be considered conventions about medical intervention and more precise delineations of responsibility, which is a tough call in a world where raising children is, correctly, seen as the higher priority.

@jennymanara - you need to brush up on your history, the welfare state as we know it has been around for less than a hundred years. People regularly died because there wasn't enough food and they became unwell, they wanted to avoid poir houses to stay as a family group. That isn't something anybody should want to go back to, but equally with an ageing society new compromises are likely. Means testing is likely to be the first step, pensions are hardly cheap after all.

im gonna be long dead before i get to state pension age after working all my life, but i think thats what the government is hoping for with a lot of people who have always worked!