Savers are heading for a wakeup call as the Government plans to phase out the default retirement age, according to Friends Provident.
The new coalition is expected to phase out the retirement age so that pensioners can work longer if they wish. At the moment the retirement age is set at 65.
With the number of workers aged 55 plus expected to grow in the next 10 years Friends Provident says that savers in the UK need to start planning ahead or face working into their seventies.
They also warn that it should not be used as an excuse to put of paying into a pension fund as many could face poor health in later life with no savings to fall back on.
Martin Palmer, head of pensions marketing at Friends Provident, said:"The concern is that by abolishing the default retirement age, we could be opening up a whole new can of worms. People need to be aware of the reality of working longer. As a nation we should start seeing retirement as a process in our lives and not a one-off event.
"We need to provide the right savings options to help enable this and help employers foster a suitable savings culture to encourage people to start investing in their future. More flexible employee benefit platforms can empower employees to choose the savings products right for their life goals and by increasing engagement encourage a bigger percentage of the working population to start making provision for later on in life."
Full details of the Government’s pension reform plans are to be unveiled in today’s Emergency Budget.
© Fair Investment Company Ltd