The UK faces a pensions crisis. People now live much longer than in the past – as a result, there is a higher ratio of pensioners to working taxpayers. In 1950, there were four people of working age for every pensioner. Today, the figure is 2.7 and the number is expected to fall to 1.1 by 2050.
Lord Turner’s interim report warned that people have four options: to work longer, save more, pay more tax or accept a lower standard of living. If we ignore the first three, the value of state pensions will continue to shrink, as successive governments attempt to control public spending.
What’s going to happen to your pension?