The pensions crisis has dragged on for years now. The hole is £200bn deep, and recent stock market rises have not helped to fill it, because bond yields fell at the same time. In fact some households are now missing 5 years worth of living expenses.
Listening to the experts, there is no plan for getting individuals out of this mess. Meanwhile corporations are busy minimising their exposure as best they can, and the UK courts have (grudgingly) upheld the law allowing employers to require us to 'retire' at 65.
Tempted as I am to campaign to raise the 'retirement age', I think we should forget it. It's only there for our employers' benefit, and they may not last long enough for it to matter anyway. For us, there is no retirement, only age. We have no pension 'entitlements'. The welfare state is dead. Investing for the future is like trying to beat the casino.
Like it or not we're in charge of our own welfare, and we need to take control. Some are calling this process "rewirement", which is nice. 'Work' is not a chore that can ever be dispensed with, simple as that. And we can't rely on a single employer. We need multiple revenue streams in case any one of them dries up. We have to remain alert to opportunities, and be flexible enough to take each one. And so on. Until we drop.
Listening to the experts, there is no plan for getting individuals out of this mess. Meanwhile corporations are busy minimising their exposure as best they can, and the UK courts have (grudgingly) upheld the law allowing employers to require us to 'retire' at 65.
Tempted as I am to campaign to raise the 'retirement age', I think we should forget it. It's only there for our employers' benefit, and they may not last long enough for it to matter anyway. For us, there is no retirement, only age. We have no pension 'entitlements'. The welfare state is dead. Investing for the future is like trying to beat the casino.
Like it or not we're in charge of our own welfare, and we need to take control. Some are calling this process "rewirement", which is nice. 'Work' is not a chore that can ever be dispensed with, simple as that. And we can't rely on a single employer. We need multiple revenue streams in case any one of them dries up. We have to remain alert to opportunities, and be flexible enough to take each one. And so on. Until we drop.
2 comments:
It is all rather depressing isn't it? Having worked pretty directly for a variety of players in the pensions and retirement planning space for more than 11 years now on the whole issue of pensions reform, one of the most depressing things is we are little further forward than those heady days when New Labour came in and the fabulous Frank Field was invited to think the unthinkable in fixing it.
He did, Brown hated it, said no and Frank quit.
A revolving door of more than 14 different ministers in the pensions hot seat has followed with very little to show for it all.
Perhaps the reason it never gets fixed is that those tasked with fixing it are working far too vicariously. They are MPs and DWP and Treasury Officials all sitting on some of the most generous and secure pensions still in existance, all underwritten by us the taxpayer. The pensions crisis to them is an academic exercise, an issue that wont hurt them - ever.
Added to this is the short term popularity game that modern politics is. A five year term but fixes requiring long term planning and patience don't fit.
There are a few people in the pensions reform world talking sense by proposing more radical solutions, but the same old same old will probably stifled these again.
To be fair to the politicians there are more than a few voices from within the pensions industry that also serve to block the kind of real change needed - vested interest in the status quo and all that. This is made worse by the fact that most of the private sector pensions world lives off contributions from the much wealthier end of the consumer market. Just look at the huge outcry when someone suggests something sensible like spreading the cost of tax relief incentives across a wider cross section of the population, rather than wasting most of it on the wealthy who would save anyway.
Sadly this may all end up being an issue too complex (half of the problem), in the hands of an unaffected bunch of politicians, weighed down by a private sector industry reluctant to change and against a back drop of terrible news and even worse scandals to ever get cracked.
MC
Amen! Best to assume the situation will never be fixed.
Cheers
SDJ
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