I turn 50 next month. As well as lamenting my husband\u2019s poor decision to organise a boys\u2019 get-together on my birthday weekend, I find myself looking more at retirement. What might it look like for me compared with my parents, and what might lie ahead for those who still possess the most valuable asset of all \u2014 time.<\/p>\n
Since Labour took office, the retirement assumptions that many of us planned around have come into question. As well as pensions being pulled into inheritance tax, the UK state pension age is likely to keep rising. For me this will mean an increase to 57 for private pensions and 67 for my state pension and those further from retirement are likely to have even longer to wait before they can access retirement savings.<\/p>\n
I can\u2019t say I\u2019m against the hike in age. But that could be because it sits comfortably within what were already my plans. It feels obvious to me that several interlocking factors are driving this push, however.<\/p>\n
\u2022 The state pension triple lock needs to be retired<\/a><\/p>\n First, people are living longer, a triumph of modern life that means they spend more years in retirement. The knock-on effect of this is that the ratio of workers to pensioners is dwindling, and the system depends on those workers paying national insurance to fund today\u2019s retired people. In other words, the calculus is changing.<\/p>\n Then there is the triple lock, which guarantees that the state pension rises every year by the highest of earnings growth, inflation or 2.5 per cent. This year wages were up 4.8 per cent, so from next April the state pension will rise by the same amount. That means \u00a3241 a week, or just over \u00a312,500 a year.<\/p>\n For those already retired, this is welcome news. For younger taxpayers it raises an awkward question: how sustainable is it to keep funding these generous annual increases for a generation that, on average, is already wealthier than any that came before?<\/p>\n Pensioners<\/a> are happily sitting on most of the nation\u2019s housing wealth, and many still benefit from gold-plated final salary schemes that have all but vanished from the private sector. Compare that with the record high rents, insecure work and declining home ownership for the younger generation, and the triple lock starts to feel like a political boiling pot serving as a stark reminder of a growing generational wealth gap.<\/p>\n