“DWP backs ‘landmark’ expansion of auto-enrolment”

Mar 20, 2023 | Pensions

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.

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a woman holding a jar with savings written on it
“National insurance cut raises questions over state pension funding”

“National insurance cut raises questions over state pension funding”

In an election year, all parties will try to be all things to all men. Mostly, it’s only stuff which matters ‘on the doorstep’ which matters. In isolation, Mrs Miggins (not my invention) will be delighted that her pension has gone up with the highest measure of inflation; and no one running a business will be complaining that National Insurance has been reduced.

“Back to work for people aged 65”

“Back to work for people aged 65”

So is it ‘back to work’ or never stopping? And why? Because we’re cash-strapped and can’t afford to retire? Or healthier and realising that working can actually keep you healthy? Well, it all depends, of course.