What do we need to do to ensure everyone has a decent income in retirement?
- Increase the state pension age sooner rather than later?
- Let AI deliver advice?
- Support a “living pension”?
- Replace the state pension with a Universal Basic Income?
- Auto-enrol gig economy workers into long term savings?
So, what are the right answers? While not always easy, it’s imperative for Government and industry to address such critical retirement planning and income challenges faced by our society and have that all important public debate about the necessary trade-offs.
The International Longevity Centre UK’s (ILC) Retirement Income Summit, hosted by M&G and supported by Canada Life, will bring together key policymakers and experts to shape and propose innovative recommendations for the next Government to action so more people have access to a decent income in retirement.
At the event, to be held on 13 June, the ILC will also be launching early findings from new research, supported by M&G, which will explore the role of the pensions industry in addressing intergenerational inequalities as wealth increasingly sits with older people. Recent ILC research has highlighted that in 2010, those under 40 held £7.53 of every £100 of wealth. Over the last decade this has fallen significantly to only £3.98
Over the past decade, auto-enrolment into pensions has helped millions more people save for their old age. But the amounts being saved are likely to remain inadequate for many, and with the cost of living rising, this will also have a significant negative impact.
According to latest figures from the Financial Conduct Authority, between May 2022 to January 2023, more than half (56%) of UK adults stopped saving or investing, had reduced how much they were saving or had used their savings to meet their daily expenses, due to the rising cost of living. This equated to 29.4 million people.
In addition:
- The UK’s 14 million Gen Xers save just £200 into their pension pots each month on average – one-third of this group are at high risk of retiring on insufficient income;
- There are 9.2 million economically inactive adults aged under 65: over 2.8 million of them are long-term sick, while others are forced to leave the workforce earlier than planned due to caring responsibilities; and
- More people are renting, with the number of private renters aged 65 and over projected to double by 2046 to 12% of all households in this age group.
We also need the next Government to focus on the challenges not just facing people in retirement but younger people. It is increasingly difficult for younger people to save as they face increased housing costs, precarious salaries, and wage stagnation. People aged under 40 hold just 4% of the UK’s wealth, which means we need to make – and take – the brave decisions now to benefit the generations to come.
The ILC’s Retirement Income Summit will consider the bold changes Government and industry need to drive over the next decade.
Speakers confirmed so far include:
- Professor Jo Blanden, Professor in Economics, University of Surrey
- Molly Broome, Economist, Resolution Foundation
- Nida Broughton, co-Director of Economic Policy, Behavioural Insights Team
- Jonathan Cribb, Associate Director and Head of Retirement, Savings, and Ageing, Institute of Fiscal Studies
- Fiona Dunsire, UK Government Actuary, Government Actuary’s Department
- Joanne Elson CBE – Chief Executive Officer, Independent Age
- Steve Groves – Chair, Key Retirement Group
- Tish Hanifan – Founder and Joint Chair of the Society of Later life Advisers
- Nadia Isgiz, Project Manager – Living Pension, Living Wage Foundation
- Mick McAteer – Co-Director, The Financial Inclusion Centre
- Sir Stephen Timms MP – Chair, Work & Pensions Committee
The event will be held at M&G’s offices in London on Thursday, 13 June. To register, go to: https://ilcuk.org.uk/retirement-income-summit-2024/
