There’s been a lot going on, and this little piece of legislation may well have crept below your radar. It means that every adult employee, whatever they earn, will now be auto-enrolled into a pension. It was previously only 22 year olds getting more than the ‘lower earnings limit’ of just under £6,400 a year. The idea is to ‘help lower earners, who have traditionally found it harder to save for retirement’. Here’s the scary thing however. If you run the numbers, someone saving 8% (the auto-enrol, workplace pension minimum) of their £20,000 salary for 50 years will have enough to give them a pension of around £8,000 a year after inflation. But very few are going to plough-on, saving at that rate for that long. And, if we haven’t sunk beneath the waves, we’re likely to have had at least 20 tinkering governments before then. So problem not yet solved, I’d say.
This month’s Interview: Nigel Clarke – Protection Specialist
Join us as we speak with John Butterworth, independent financial adviser at Philip James Financial Services. We learn about John’s background and talk about savings, investments, and how we can help manage your pension.
