When it comes to retirement, is anything guaranteed?
‘When will I be able to retire?’ is a question that people didn’t have to ask in the days of final salary pension schemes. Today, it’s very much on the mind of anyone who is starting to think about what their later life could look like. So, how did we get here?
For most of us, it’s hard to believe that there was a time in the 1970s and ‘80s when company pensions were generous and there were enough people taking early retirement for the Organisation for Economic Co-operation and Development to call it a ‘strong trend’.
Fast forward to now, and our long term saving and retirement survey found that many people thinking about retirement are concerned about having enough to live on when they no longer work.
So how did we get from a trend towards early retirement to wondering if we can afford to retire at all?
The part played by employers
The system has been struggling since employers began to switch from ‘defined benefit’ (final salary) schemes to ‘defined contribution’ schemes back in the ‘90s. This largely shifted the pension burden from employers to employees as companies were no longer obliged to provide a specified pension at retirement.
An aging population and the State Pension
Meanwhile, the State Pension has been under increasing strain as the UK’s population ages and a higher proportion of the population than ever before are claiming the State Pension. Not only that, but as life expectancy increases, retirees tend to claim the State Pension for longer too.
The ups and downs of unpredictable pensions
In a nutshell, the State Pension, currently just £6,029 per year, simply isn’t enough to support a comfortable retirement. The upshot of this is that the onus is on individuals to boost their retirement income themselves.
However, even if you’ve saved diligently for decades, the pension you receive can be dependent on how the stock market has performed, among other things. So, until you retire, you can’t be certain about how much money you’ll actually have to live on.
Even small savings can make a difference
Even if you don’t have pots of spare cash to squirrel away, modest savings can still make a difference to the type of lifestyle you could enjoy in later years.
There are, for example, some affordable savings plans that provide you with a minimum return that is guaranteed. You could use these to boost your retirement income with a guaranteed sum that you can plan around.
Calculate your future
Want to see if there’s a shortfall when it comes to funding the retirement you want? Find out with our handy calculator.
How do your retirement plans compare with the respondents to our long-term savings and retirement survey? Find out here.
This blog is intended to provide information, not financial advice, to help you make an informed decision about savings and investments. We do not offer financial advice. You should contact a financial adviser, who may charge a fee, if you want financial advice.
Helping those less fortunate this Christmas – Spreading the Community Spirit
Christmas is all about getting together and giving, and here at Foresters Friendly Society we’re doing just that. Find out how you too can make a difference to someone’s Christmas this year…
Community Involvement at Christmas
Foresters Friendly Society is founded on mutuality, which means we look after our members. For over 180 years we have been supporting local communities, and we’re still working in the same way today. In addition to the many charities supported by our local groups, as a Society we’re proud to be supporting Alzheimer’s Research UK, the UK’s leading research charity aiming to defeat dementia, as our annual charity for 2015/16.
Throughout the past few months, Foresters members up and down the country have been taking part in a whole host of activities to raise money for Alzheimer’s Research UK. Fundraising events have ranged from hikes to balls and dinners, and in the festive period local Foresters groups are also selling a range of calendars, cards, treats and jewellery to help raise even more cash.
Christmas is the perfect time to get the whole family involved in helping others, and what better way to while away the winter evenings than some charity caroling or a cake sale? Here are some of the many ways you can get involved and make a difference this Christmas:
Food for thought
In 2014, 60,000 people, a third of whom were children, were fed by Christmas food banks. There are around 420 foodbanks helping communities up and down the country. You can help by donating non-perishable items at your local supermarket drop off points. Find your local foodbank online with the Trussell Trust.
Home from home
It is estimated that around 100,000 children will be homeless this Christmas but, fortunately, there are dedicated charities that help support the homeless during the festive period. Why not show your support by donating, fundraising with a raffle or bake sale or even volunteering at a local soup kitchen? Visit the Shelter website to find out more.
A friend in need
Christmas can be a particularly difficult time for those without family or friends. The elderly particularly need our support, not just to stave off loneliness, but also to make sure that they are safe and well as temperatures drop. Check in on your neighbours and those known to you in your local area, or get involved with one of the many befriending campaigns across the country. Give your time to the elderly through Age UK’s #ManOnTheMoon campaign.
Because a dog is not just for Christmas
Christmas is also a busy time for pet rescue centres. With families feeling the strain of Christmas budgeting, and many pets bought as impulse gifts, cases of abandonment can be higher at Christmas. Donate to your local pet shelter or bring the festive cheer by taking along a bag of animal safe treats and toys. Visit the RSPCA website for gift ideas and more.
Giving a gift with a difference
If you’re holding a Christmas get together this year, you could consider asking your guests to give a little to Alzheimer’s Research UK. Instead of the standard Secret Santa where everyone buys a gift for one other person, simply hand out fundraising envelopes and your guests can give discreetly with as little or as much as they like. Find out more and request gift envelopes here.
It’s easy to see that making what is often a simple gesture this festive season could really make a difference to someone’s Christmas.