PENSION INCOME: START SAVING ASAP

THE key to having a good pension, is to start saving as early as you can.

That’s the advice Pension Expert Don Newman, Project Manager of High Point Community Services, is giving, following a Government announcement that the State Pension age could rise.

Mr Newman said: “People think pensions are very complicated, when in fact they are not.”

Currently men receive a state pension when they reach 65 and women 60.

But earlier this month Lord Adair Turner, Chairman of the Financial Services Authority, published a report into the future of Britain’s pensions system.

It calls for the state retirement age to rise to 68 by 2044.

Mr Newman, who is also hoping to become the Chairman of the newly-formed Older People’s Group, added: “People can retire at whatever age they like, but it depends on their income.

“The main mistake made by the working population is that they don’t plan to fail when it comes to saving, but fail to plan.”

The Pensions Regulator supervises both the pension industry, and employers who administer pension schemes.

Chairman, David Norgrove, said people would “undoubtedly” have to work even longer, to make ends meet in their old age.

He added: “Given recent legislation, increasing the retirement age progressively to 68...I think it will end up higher than that.

“People are going to have to work longer. We, as a nation, are not going to save as much for retirement as we did in the past.”

He said there was a lack of knowledge about how to save, meaning the ability of the current working generation to pay for the retirement of the previous would be “a real issue for the next 30 years.”

“The evidence is that people generally are frightened of saving for pensions,” Mr Norgrove added.

This has been echoed by Mr Newman: “It is almost impossible to retire at 50 because people will not have made an adequate income, and this is my main concern.

“If you don’t have a private or company pension, then according to national statistics, around 15 to 20 per cent of older people are living below the poverty line.

“But I think over 50s will struggle to get a job because there is a feeling that once you reach that age you are over the hill, and we have no value for them in this country.

“Ideally you should start saving from when you’re 30, in order to have a good pension fund when you do retire.”