Devonshire October November 16

Independent Financial Adviser
Celebrating 24 years of Business in East Devon
MANAGING your MONEY
Helen has been advising clients
in the East Devon area for the
past 24 years and specialises in
the provision of retirement and
investment advice.
State Pension
- under fire again!
To find out more about her practice,
you can view her company website
at: richmondindependent.co.uk
01395 512166
Helen Mulvaney
BA (Hons), Dip M, DipPFS
Proprietor of Richmond Independent
Back in the early summer, Lord
Adair Turner, former chairman of
the FSA and Pensions Commission,
proposed raising the state pension
age to 70 by 2030. This would affect
those workers who are currently
aged 56 and under and who would
need to work even longer before
gaining entitlement to their state
pension. Lord Turner was speaking
at a private event and suggested
proposals for introducing earlier
access for those in physically
demanding jobs or those on low
incomes.
changes are
probably inevitable
and we might even
find that it's not
just state pension
age that is affected
Currently, the timetable for raising
the state pension age eligibility
stops at age 68. We've reported
in earlier articles that the major
reason for changing the state
pension age eligibility is the current
cost of state pensions.
The new
"flat-rate state pension" which was
recently introduced will eventually
put a cap on the amount of state
pension entitlement and workers
will no longer be able to build up the
generous state pensions which have
been built up through contractingin.
The long term costs of the state
pension are already considered
unsustainable with the government
estimating pension costs at around
8.5% of GDP*. Recently, Ross Altman,
the former pension minister, caused
a great deal of consternation when
she suggested that the expensive
triple lock guarantee should be
dropped by government to save
billions of pounds. Pensioners have
been particularly badly affected by
the financial crisis of 2008 whereby
extremely low interest rates have
had a devastating effect on annuity
rates and also on deposit accounts,
forcing some pensioners to take
much more risk than they want
to with both their pensions and
investment/savings. Losing the
triple lock would be yet another
blow and would make life very hard
for many elderly pensioners on low
incomes.
In August, a report of the
interdepartmental group on Fuller
Working Lives stated that the
retirement age may need to be
increased and I understand that
John Cridland was appointed to chair
a new governmental review into the
State Pension Age by Ross Altman
back in March. Individuals, charities,
businesses, research groups and all
other interested stakeholders are
invited to share their views on the
State Pension age by emailing spa.
review@dwp.gsi.gov.uk.
long term costs of
the state pension
are already
considered
unsustainable
So it appears that changes are
probably inevitable and we might
even find that it's not just state
pension age that is affected but new
changes might be introduced which
will consider people's wealth, job
or life expectancy. This situation, I
If you would like to read more of
Helen's articles visit her website:
www.richmondindependent.co.uk
think, is bound to cause controversy
on the grounds of fairness and this
would be both contentious and
complicated to administer.
WASPI
(Women Against State
Pension Inequality) has criticised
successive governments for failing
to properly inform those who will
be affected by State Pension Age
changes. So, once again, there may
be changes affecting those who are
creeping closer to retirement and
it would appear that you'll need
to work hard to ensure that you
understand the changes and how
they might affect you. After all, for
many people, the state pension will
form the basic building blocks of
their retirement planning and to
find that everything has changed
significantly could mean great
financial difficulty, probably at time
when you're least likely to be able to
make changes to deal with it.
Please contact Helen Mulvaney of
Richmond Independent for further
details. Tel 01395 512166
Source * Government Green paper
Richmond Independent is a trading name of
Investment & Financial Solutions Partnership
LLP which is authorised and regulated by the
Financial Conduct Authority
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