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Retirement Planning

Will the state pension suffice?

Even if it is not currently top of your agenda, being able to retire when and how you would like, is sooner or later likely to be one of your most important financial objectives. But achieving this goal takes planning and perseverance. Unless you are in the fortunate position of having a final-salary pension scheme which is not underfunded you will almost certainly need to augment your state pension. You could spend a third of your life in retirement. Will you find those years the golden times we all dream of, or a constant struggle to pay the bills?

Your state pension is worth about £5,700 at current rates, assuming you have a full national insurance record. For those reaching state retirement age from 6 April 2013, this requires 30 years' contributions. If you have not yet retired, we can help you check your record and see if any gaps can be filled. A review of your state pension entitlement will also indicate what you may expect to receive as state second pension, SERPS and graduated pension. The Government has announced that from 2016 a flat pension of around £144 per week will be available to all, with entitlement through SERPs and S2P abolished.

The state pension age (SPA) is also changing and it is far from clear that we have the final definitive position. Currently:
  • Men born before 6 December 1953 retain their SPA of 65
  • Women born before 6 April 1950 retain their SPA of 60
  • Women born on or after 6 April 1950 but before 6 December 1953 will have an SPA between 60 and 65
  • Men and women born on or after 6 December 1953 but before 6 October 1954 will have an SPA between 65 and 66
  • Men and women born on or after 6 October 1954 but before 6 April 1968 will have an SPA of 66
  • SPA is to increase to 67 for all by 2026
  • It is planned that SPA will rise to 68 and beyond.
Check your state retirement age:

The Government has announced that the state pension will in future increase by the highest of price inflation, earnings inflation and 2.5%.

According to government estimates, the gap between how much people are saving and how much they need to save to ensure a comfortable retirement is over £60 billion. It believes that 13 million people - nearly half the working population - are not saving enough for their retirement.

Use Crokers Financial Planning to look at ways to achieve your retirement goals. Acting for you not a company.