To think increasing pension age isn’t going to add up?

[Tiredandconfused23]

I was reading a few recent studies about the employment situation for over 50s, basically confirming how this age group struggles to return to work, is more likely to be laid off and/or forced into early retirement and how a far higher proportion are in poverty and/or insecure employment than other age groups. And how, despite years of pushback against age bias, it’s only increased in recent years.

If we accept this, I can’t help feeling the idea that increasing the pension age so we work longer, thus save money on benefits, isn’t going to add up. Many people in their fifties would happily carry on working - the issue is many employers may not want us. You can’t keep working if there’s no job to work at.

AIBU to think we may soon be facing a load of older people on benefits, often through no fault of trying, rather than claiming a pension? Would this be seen as still more favourable by the Government?

I realise where our confusion has come from now

I dint think @Bodeganights was confused! 😆

They haven't "paid their share" though. They may have funded the state pension of those who claimed it at the time. But many won't have even covered what they took out.

Money may not be fairly distributed but even if we could free up funds why should it be spent on this age group over others?

🤞 Good Luck!🍀

Acknowledging that we have an ageing population & recognising that demographic shifts have certain ramifications which the government has ignored isn’t complaining about people living longer.

This is going to be a massive problem and increasing the age isn't going to help.

Currently many retirees are home owners (75%) and have paid off their mortgage. This will start to change very soon with people renting into retirement. How will these people afford to give up work even if the retirement age stays the same? How will the government handle thousands who have 'paid in' who now need housing support let alone those who will never work/work very little. How soon until we reach the point where it's not worth 'paying in' as you get more when you've got nothing. This is happening already with those on pension credit now getting more than those on the basic state pension having worked all their lives.

Additionally the number of children with SEN is huge requiring on-going support. I assume many of these will not be able to work full time in well paid jobs so will need on-going support.

If they raise retirement age too far the incentive to keep working is reduced for anyone other than those with a decent private pension and assets.

@Superworm24 you’re braver than me! 😆

I agree-I’m 61 and do 15 hours. It’s quite a physical job so plan on staying until 65 if healthy-but could not do my job full time-it would send me to the knacker’s yard.

We do have an issue with people living longer but in poorer health. That is what the healthy eating and exercise messages are about.

Times gone by a poor lifestyle may have killed people in their late 40s or 50s, now the same lifestyles will see people limp along until their 70s or even 80s with multiple long term conditions.

Paying your share is paying everything expected of you throughout your working life based on your tax liability. I’d lay money on most people covering what they take out. The working life of today’s retirees spans roughly 50 years in most cases. Between income tax (which was over 30% basic rate when most of them started work), NI, VAT, stamp duty, fuel tax and council tax, they’re pretty certain to have paid their share. Add in that a high proportion continue to pay income tax in retirement, along with all the other taxes apart from NI.

I’d lay money on most people covering what they take out

Thats unlikely, but happy to be proven wrong.

With our parents 3 out of 4 were made redundant in their 50s.

One tried for similar work but ill health meant ended up retried - lived off redundancy and p/t wage of other parents then personal pension then inheritance till 65 and could claim state pension as well.

Another was made redundant from skilled factory work that had left area entirely did slightly fewer hours as cleaner out more unsociable hours till retirement which was raised as they were part of female generation who lost out with state retirement ages.

Other one had skills needed but could find no work so set up own company and worked till 69 decreasing hours in finally years and only giving up when health heart got bad - that was physical job as well.

Finally one gave up work in 50s when elder care then spousal care and own health just got worse and worse - lived off savings with other parent till state pension kicked in.

I think it was easier as they paid mortgages off bit earlier than we likely will and as had kids younger so had more years to get in good place - so think in future it will be harder. What didn't happen was that they cost the state more money in benefits.

As population ages if they can pay out less in pensions by raising retirement age they will - and yes that will have knock on effects - to more on benefit before hand, greater poverty as assets get depleted before they hit payout date - less jobs for younger people in workforce and less childcare help for younger generations. However they are looking at one figure as it will get to be a huge amount and looking to see if they can push it back onto the population/individuals more.

But it’s redundant anyway as it’s paid forward hence why the pyramid turning upside down is the issue.

Then why did you bring it up?

@Inslopia I agree that many of today's economic problems are because of the false economy approach - austerity etc

The way to address this (and hopefully the new government will do the right thing) is by ending the false economy approach

Good well-funded public services, supportive benefits system, more social housing, state pension age not too high and a sufficient amount of money to live on, improved child maintenance system, and jobs, education, and training opportunities.

The above would reduce need for support - the numbers of people in need at all and period of time of being in need.

Social housing wouldn't solve every issue, but it would make a major difference. Significantly lower housing benefit bill and lower benefit bill fullstop. Because:

a) less need for top-up benefits for lower wages jobs, and

b) fewer people needing sickness benefits. As the BMJ study found, private renting harms health. So a higher disability benefit bill, and costing the NHS and social care system billions.
(Obviously there's also the moral need for more social housing).

Bring up what?

Still keen to see your stats though…

Salaries are going backwards I'm looking at a 10k pay cut based on my previous salary in this market just to get something ( currently unemployed.)

Got approached re a manager role, responsibility for all HR on site, needs qualified/ experienced etc and employer only willing to go up to 35k no more.
What's more rubbish is that they will find someone desperate enough to take it (not me )

many won't have even covered what they took out.

It was you who said this? You show me your stats and I’ll show you mine.

I agree too. Apparently it cost around £20bn to cut it, so would fill the 'black hole' to reverse it in one fell swoop. Rather than scrabbling around trying to find the money from various places.

I've heard that reducing the tax efficiency of pension contributions is being considered. Surely people should be encouraged to pay into a private pension??

@Windchimesandsong

“Good well-funded public services, supportive benefits system, more social housing, state pension age not too high and a sufficient amount of money to live on, improved child maintenance system, and jobs, education, and training opportunities.”

I don’t think anyone would disagree with the above but the issue is the money to pay for that, there have been years of chronic underinvestment. Taxing the “rich” isn’t the realistic answer though.

Personally, I’m more than happy to work until I’m 70 so long as I’m able. However my real fear is jobs, in general, are either being cut due to automation or else restructured so that one person now does the work of three in order to keep those share prices buoyant and “do more with less” (as the corporate mantra goes). We have no investment either - my partner works for a council department that know they’re understaffed and the service is deteriorating because of it, but they have no money to recruit and train anyone - it’s the same everywhere.

For better or worse, managers are often averse to managing people older than them, especially those they may view as being overqualified.

It’s that assumption that’s being made of “if you’re healthy, due to modern living, you can work for a few more years” when, maybe, even if in theory you can, in reality you’re not allowed to. I’ve seen companies restructure people into early retirement just to scrape more “efficiency” savings. The positions of the Government and a companies are at odds.

You'd be losing that money. This is from the ONS "In FYE 2022, 53.8% of all UK individuals were net recipients (living in households receiving more in benefits than they paid in taxes), a reduction of 1.2 percentage points since FYE 2021. A much greater proportion of retired individuals were net recipients (89.2 %) in comparison with non-retired people (46.0%), largely because of the classification of State Pension and Pension Credit as cash benefits." And this is only benefits. I'm not sure if the figures exist but it would be interesting to see how much education, health care etc adds up to over the entirety of someone's life.

And of course you have to pay tax in your retirement, you put that off and therefore pay less tax as a result.

Obviously though to actually have a better society (easily achieved by ending the false economy approach, as I detailed above), it's necessary for a majority public consensus and to demand that. So the public - all age groups - needs to focus on asking for what's right and what's needed. Rather than different age groups, especially the poorest and most vulnerable of any age, being pitted against each other.

@Blossomtoes

It was you who said this?

Nope

You show me your stats and I’ll show you mine.

But you said I’d lay money on most people covering what they take out

so show us the money 😆😆

There is the money. It's just being misspent.

As an example, billions is spent on housing benefits for private rentals. And billions on substandard temporary accommodation (plus billions more on the health and social care needs caused by lack of decent affordable social housing).

@Windchimesandsong yes it’s absurd that billions of tax payers money is funnelled into private landlords when we could have more social housing. I’m fully aware of that.