Why might state pension age increase to 75?

Last week, Iain Duncan Smith’s think tank outlined plans to increase the State Pension age to 75. This has been met with meaningful criticism. However, with significant changes to life expectancy, long-term funding of the State Pension looks ever more challenging.

So, why might state pension age increase to 75?

Here are some interesting stats on population demographics and life expectancy from Age UK:-

  • Around 12 million people in the UK are over 65. In 50 years, it’s thought there may be another 8.5 million
  • By 2030, 21% of people in the UK will be over 65, 6.8% will be 75+ and 3.2% will be 85+
  • 85+ is the UK’s fastest growing age group, set to double by 2041 and treble by 2066
  • There are just over 14,000 Centenarians in the UK – an increase of 85% in 15 years. By 2030, the number could be 21,000
  • It is projected that 23% of male and 29% of female babies born in 2018 will live to the age of 100.

Clearly people are living longer, a trend that is set to continue. Money must work harder than ever before and this requires the best of advice. Simply accumulating wealth, disinvesting, then drawing an income will no longer suffice. Along with life expectancy, advances in healthcare mean potentially staying healthier for longer. This perhaps means spending a little more throughout retirement.

Innes Reid has been adapting to these changes for some time now. Our financial planning proposition has evolved to cater for clients that still need to grow their wealth whilst taking income.  No two clients are the same and goals and time horizons will be different. The key is very much a holistic approach for each and every client. This ensures the risk of running out of capital and subsequently income in retirement are minimised.

To find out what differentiates Innes Reid from other firms of Financial Advisers and more about how we can enhance your quality of life in retirement, get in touch today for a free consultation. Call 01244 347 583 or email us at info@innesreid.co.uk. Initial consultations are free. 

 

FacebookTwitterLinkedInShare
The Financial Ombudsman Service (FOS) is an agency for arbitrating of unresolved complaints
between regulated firms and their clients. Further details of the FOS can be found on its website:
www.financial-ombudsman.org.uk