State pension changes can happen any time
Although the idea of simplifying the State Pension is a good one, and the flat rate pension proposed this week does make it far easier for all concerned, there are some troubling issues.
The message from the Government for a long time now has been to sort yourself out. The fact that pensioners are costing the Government more money than the State Pension system was ever designed for is no secret and the Government has continued to introduce various measures over the past few years to address the problem.
What is of real concern is how easily the Government, any Government for that matter, can make changes to the Pension system and therefore changes to your own personal income in retirement.
I would be seriously troubled by the fact that I could work countless number of years to get to retirement only to have the rug pulled from under me with only a few years to go.
There are many people that would rely on the State Pension to make up a reasonable or even sizeable proportion of their retirement income. To think the amount you will get can change at the drop of a hat is just another reminder of how important it is to look after yourself and not rely on others for your security in retirement. Knowing how much to save and achieving the right balance between living for today and saving to live in the future is the basis of any good financial plan.
Nobody wants to work into their 80’s just so they can put the heat on when they get home. The only way to ensure that will not happen, for me, is to plan in advance for a retirement income that will be sufficient to live the life you want with or without the help of the Government. If you can get to a stage where the State Pension acts as a bonus in retirement then you are doing the right thing.
For everyone else, well the future is not in your own hands and that is a scary thought.