Sunday Post – Start Planning Now for Reaching your Century
by Dr. Ros Altmann
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Figures released last week show that 2.2 million of those already over fifty will live beyond a hundred.
This is a great news story, but the danger is that it turns into a terrible one about millions living in penury.
We shouldn’t be surprised that people are living longer. Governments have seen it coming. Indeed they have helped make it happen with billions invested in improving health and medical care. Unfortunately, however, they’ve not done enough to deal with the consequences by tackling the pensions system and the jobs market.
Employees, employers and government all need to think differently about life beyond the traditional retirement age.
My hope would be that I am well enough and able to carry on working but not necessarily at the same pace.
Even if you cut back to two days a week, you’ll still have five free days, and more money to spend on those days.
It’s not just the young who will have this extended life, it’s people who are already in their fifties and sixties.
One thing I’ve learned from many years working with pensions is that we all underestimate how long we will live and the old stereotypes don’t apply any more.
Pensions were designed with the idea that people would not live beyond their seventies, or their eighties if they were really lucky.
Yet that’s not the case. Average life expectancy for the over 50s is 80 to 85 and many will live a lot longer.
This means attitudes need to change. You can try to live on the state pension, which isn’t much. You can try to save more but if you are already in you fifties or sixties it’s a bit late.
So where else might money come from? That’s when you might realise that you have an awful lot to offer. You’ll have spent your whole life building up skills and getting good at what you do. Why would you then throw yourself on the scrapheap, work-wise?
It’s a question of thinking what you can do, rather than focussing on what you can no longer do, and then making it happen. Of course, the labour market needs to change, but I’m sure that will happen sooner or later.
Living longer should be viewed as a tremendous opportunity rather than something to be afraid of. There’s a whole new phase of life out there and it would be great to grasp it with both hands.
Employers also need to embrace the abilities and opportunities of older workers. When you talk to employers who have done so, they tell you they get more out of two older part-time workers than one young full-time worker.
Companies like B&Q, BT and BMW have all benefited from using the skills of older people.
This will also benefit younger workers because if people their sixties carry on working they will have money to spend on products and services that will create jobs for younger people.
If we end up with more older people living on benefits which have to be paid for by a younger workforce, there will be less money going round and that will affect the whole economy.
There will be a lot more demand on health services and care services, and we haven’t geared up for that yet.
Government needs to help orchestrate a rethink in the way we plan for retirement and old age.
Policymakers must encourage employers to make work available, facilitate later life re-training and sort out the pension system.
At the moment the state pension doesn’t give you enough to live on, and it’s much too complicated for people to understand to allow them to plan properly.
Politicians’ short term time horizons have meant that, although they knew these demographic changes were coming, they haven’t done enough to prepare for the consequences.
The fact that we’re living longer than ever is great news, but only if we change the way we think about later life and view it as an opportunity rather than a threat.