Planning for old age – “at least meet me halfway”

Today’s newspapers and news outlets are almost all carrying a similar story regarding the over 50s “sleepwalking  into old age” with respect to their pension provision following comment by the National Association of Pension Funds (NAPF) and a report by the Institute for Fiscal Studies regarding increased life expectancy.

(e.g. http://www.bbc.co.uk/news/business-20543308)

Such issues are extremely important as is the allied issue about older people sleepwalking towards an unhealthy old age by virtue of their inappropriate lifestyle choices.

There is no shortage of information on these topics but rather people just do not seem to want to put any effort into understanding these things, matters which are going to affect a great part of their lives in a very fundamental way. Rather like my disappointment at not winning the lottery can be largely explained by the fact that I don’t buy any lottery tickets so individuals must show greater commitment and take greater responsibility for their own future well-being.

We all know it’s boring, we all know the institutions have vested interests (note the focus here on pensions and not other forms of financial provision) and we all know it can be difficult – but not that difficult, not the basics anyway!

So that people can get their heads around some of the issues I attach below the link to a brief description which I wrote a few years ago and which has not changed in the slightest way – except become more urgent.

http://www.inmyprime.info/factSheets/biscuit.htm

Dealing with the reality of living for a hundred years

A new report from Scottish Widows predicts that a third of babies born today will live to be 100 and, as a norm, will work until the age of 70. Girls are more likely to reach this age – 39 per cent – compared to boys (32 per cent).

There’s something of a fairy-tale quality about the phrase “living for a hundred years” and thinking about the implications shows that a good fairy with a magic wand might be required for ensuring a long and happy life for today’s babies who are going to experience such longevity.

The report anticipates that as people face the challenge of saving for their first home and paying off student loans (which at around £73,000 will take until average age 52), ‘an increasing proportion will either have no children or just one child’.  

They will also need to find money to save for a pension and to continue to work longer in some capacity in order to fund living comfortably for the longest anticipated retirements in history – up to three decades.

Naturally (as it comes from a financial products provider) the report’s main message is that these ‘new centenarians’ will need to start saving at the age of 25 to build up a decent pension to have any chance of being able to retire comfortably.

However, surely it is simplistic to think that this will be sufficient to deal with a change of such magnitude? It seems to me that innovation will be required in a number of areas, including:

·  Housing – in terms of both assisting younger people to get on the housing   ladder, and more flexible options for helping older people free up housing equity.

·  Education – a review of our current ‘university education at any cost’ culture and a greater emphasis on life-long learning

·  Working patterns – making part-time, flexible and contract roles throughout the career-span the norm, thereby enabling people to dip in and out of the workplace more easily – and to extend their working lives.

·  Spending patterns – a review of priorities e.g. although divorce rates remain high it is predicted that young centenarians will spend around £39,000 on their wedding (compared to their grandparents average of£4,400)!

· Attitudes to healthy living – to ensure that those later years are spent in some kind of good, or at least moderate, health.

Commenting on the report, leading economist and trend forecaster Steve Lucas of Development Economics suggests that today’s parents “should encourage their children to start understanding finance and stress the importance of saving from a young age”.

This sounds a worthy strategy but might it be undermined by the reality of today’s parents neither understanding financial matters sufficiently themselves, nor having the ability and/or will to save for their own old age?http://reference.scottishwidows.co.uk/docs/2012_11_new_centenarians.pdf

However, before anyone becomes too smug or complacent, other indications suggest that the pensions industry is already planning for anticipated life spans of 125 years!

Budget blues

It has always seemed to me a great pity that politicians and business leaders never seem to take the big and painful decisions at the right time – that is when times are good, rather than when times are bad and they are no longer in control of the process. Oh for a few farsighted statesmen rather than the short-termists we always seem to get, concerned only with their own immediate impact and survival.

And so it is now with the various measures being taken to deal with the issues surrounding a large and growing older population. The Budget just announced has come in for a lot of criticism, as they all do, in particular this time with regard to pensions and pensioners. But the concerns driving some of the current measures have been coming for decades and nobody was prepared to tackle them at the appropriate time. And so they have to be addressed now, at a time when any measure is going to be painful for someone, whether it is the young, the “squeezed middle” or the older population. In the end the pain will have to be shared around and we can only hope that such pain will, in the long run, be less here than in some other countries.

So let us stand back a moment and look at the bigger and longer term scenario, one that will quite definitely not go away of its own accord. There are certain things about matters related to demographics – they have the weight of numbers on their side and you can see them coming a long way off.

The first thing is that the population as a whole is living much longer than it used to. Living longer is generally a good thing, provided we can address the issues surrounding health, personal financial well-being, and a reason to get up in the morning. Living longer is something that will affect everyone, the young, the middle-aged and the elderly and so measures must be put in place to prepare everyone for later life, in an environment in which government funding is not a bottomless pit. After all, the money comes from us – we give with one hand we take with the other.

Therefore living longer (a good thing) implies working longer and/or saving more. And so state pension age will have to increase alongside increasing longevity, not only for financial reasons but for an individual’s feeling of value and worth and for the social interaction work brings. With this must come the ability to stay in work longer, in terms of health, the work environment itself and the right to continued employment.

And for those with some way to go to retirement, saving must be seen as a worthwhile venture. For some years there has been a powerful lobby suggesting there be an adequate universal pension for everyone, removing the excuse that saving is not worthwhile because with means testing later on you might as well spend it now rather than save it. This is being put in place. What we now need are some worthwhile savings mechanisms. They too, hopefully, are coming.

It is quite possible to argue about the fairness of the transition arrangements, for all sectors of the population not just pensioners, but directionally I believe that we are now beginning to see some progress.

 

 

 

 

Well enough to work?

An interesting session was hosted in London on Tuesday by the International Longevity Centre (ILC): Older workers, health and employment. While nothing overwhelmingly new came out of it, the keynote speech by Dame Carol Black in particular on trends in the health of older workers nevertheless created an impact.

Although, as she pointed out, one in four of us born today can expect to live to 100, the factors mitigating that in terms of our own poor health are startling. As the fourth fattest nation in the world we are facing a situation where 40% of all UK adults will be obese by 2025 and three quarters of the population will be too ill to work to the projected retirement age of 68.

Her presentation clearly underlined Abraham Lincoln’s point that “It’s not the years in your life that count but the life in your years”. The spectre of so many of us living longer in ill health and disability is an appalling prospect at every level – individual, societal and economic – and tantamount to a total disaster.

In the main the session focused on what employers can or could do to help the situation through health and wellbeing programmes and what these might encompass. Little mention was given of individual responsibility and how, rather ironically in light of this topic, you can lead a horse to water…

Realistically lack of knowledge about lifestyle habits and their effects generally isn’t the problem, and neither is lack of employer support. What is the problem is lack of motivation, good role models and a realistic understanding of the consequences of our actions (or inaction).

If those of us “in the know” in the ageing arena can be startled by such figures, surely a well-produced TV documentary series would have considerable impact on the man (and woman) in the street?

Agenda for Later Life 2011

Yesterday I attended the “Agenda for Later Life 2011” conference in London organised by Age UK and sponsored by Sainsbury’s. The material was fascinating from start to finish and reflects a really well structured, well organised and well presented event.

The topics covered included work, health, care provision, pensions, older people as consumers, poverty, financial abuse and many others. In fact, the list of concerns, all extremely pressing, is almost endless and it is good to see that these are being given the attention they deserve with high levels of government involvement. Well done to Age UK for giving them such high profile and for the continued lobbying and pressurising.

If there is one criticism that I would level, not at the conference itself, but at the wider community, is still there are too many “weasel words” and not enough action and direct intervention, particularly by employers and by commercial organisations. I really do think that people know when they are being sold a line.

Nevertheless, well done and if anybody would like to read more and to see “Age UK’s 12 challenges for an ageing nation” click on the link below.

http://www.ageuk.org.uk/professional-resources-home/

The new longevity: does that include me?

In what was evidently a none too subtle attempt at attitudinal engineering, the DWP released the news as the old year died that some 17% of us who are now alive will live to be 100. No doubt the subliminal message was intended to be that we all ought to do more of the things that are necessary to sustain such alarming longevity such as looking after our health, saving more and working longer. 

Of course, the latter element isn’t purely down to personal choice and much as one might hope that a wake-up reminder about longevity will have employers marching back to work today determined to consider new strategies and policies to retain and recruit older employees, realistically it’s unlikely.

Having read numerous feature articles over the past few days focusing on the new statistics I was interested to see that none mentioned a key dilemma from the individual’s perspective – that is trying to rationalise how long your own lifespan is likely to be. The sad and untimely deaths of the actor Pete Postlethwaite at age 64 and musician Gerry Rafferty at 63 were stark reminders that, for many, the end can still come far too soon.

Much of what was written concerned the need for individuals to work longer and revise their attitudes towards ageing. All good stuff and eminently sensible if you know you are going to make it into your eighties, nineties, or even older. But many people, based on family history and the experiences of friends, colleagues and acquaintances still have an underlying suspicion – despite all the demographic statistics – that they themselves may not. Hence why stopping work as early as possible, spending on luxuries and living for today are an attractive and, in some ways, logical option.

Apparently scientific developments relating to the ability to make individual predictions of longevity are impressive but so far are neither widely accessible nor infallible. And of course, there are dangers if they fall into the wrong hands. Nevertheless, perhaps the time has come when we need to stop being so coy about the issue of when we each might shuffle off and start demanding individual assessments based on such measures as are available.

Of course no prediction could be guaranteed but, compared to the current situation where ageing means entering the land of the complete unknown, access to what meaningful information there is at say age 50, including one’s risk of particular diseases, could be a useful starting point for planning one’s future life.

BBC “Living longer” week – this week

Hardly a week goes by now without some aspect of the huge demographic change taking place capturing the headlines. One week it is retirement age, another week pensions, another unemployment, or maybe age discrimination. The issues are all vitally important and ever more pressing. This week the BBC is devoting itself to exploring a number of issues.

BBC ‘Living Longer’, a week of special programming on all Local Radio, on-line and regional television in England is running from Sunday, 7 November. Through specially commissioned research and grass roots reporting in the English regions, BBC Living Longer examines, in depth, the issues and opportunities facing an ageing population including social care; impact of caring on families; the cost to the NHS; work, retirement; and the opportunities of ageing.

Forty local radio stations, 12 regional television news programmes and a number of regional Politics Show programmes, as well as 44 local websites are working together on the editorial. And 40 BBC local reporters will file reports throughout the week.

A Facebook page has been specially created at www.facebook.com/bbclivinglonger for people to contribute or you can visit www.bbc.co.uk/livinglonger to keep in touch with what is going on and being said.

As part of the week of coverage BBC Local Radio has carried out research into the future of social care provision by local authorities in England and will reveal the number of complaints about elderly care services in the last 3 years. An indication of the best and worst places to grow old will also be provided through a specially commissioned report from Experian.

David Holdsworth, Controller BBC English Regions said:

“Living Longer is tackling an issue that affects all of us. No matter what age. Either as carers ourselves or the care we are likely to receive when we are elderly. BBC Local Radio will bring together its radio, regional television and on-line services to deliver a comprehensive picture of what the future holds for growing old in England today. This will tap into grassroots public reaction providing an England-wide picture in a week of extensive coverage that links into BBC network output.”

Taking control of living longer

A team of Boston scientists appears to have cracked the key to longevity. Through development of a mathematical model based on genetic information taken from 1,000 centenarians they have identified 150 genetic signposts pointing to the likelihood of living beyond 100.

Although this model is still in the early stages of development and currently has an accuracy rate of only 77%, it is a remarkable and thought-provoking breakthrough.  If it is found to be a robust predictor of individual longevity it raises myriad questions about society’s right to act upon this knowledge and our own ability to cope with it.

News reports mention that the predictor soon may be made widely available, potentially making it attractive to pensions and insurance providers.  Individuals themselves also could make decisions based on the information. But as we know already from situations such as cancer prognosis, people differ in their desire to want to know outcomes and in the actions they take. As one of the scientists working on the project, Dr Thomas Perls, said, “What do you do when you are told you absolutely don’t have an exceptional signature for longevity?  Do you go and do a lot of risk taking behaviours… or does it give you impetus to take all the better care of you?”

 Currently, although one in 15 people has the genetic makeup to live to over 100, only one in 600 does – due largely to lifestyle factors.  And, as the 23% error rate in the test is attributed to people having different backgrounds and lifestyles, issues around individual and social responsibility for successful ageing become highly pertinent. The part played by lifestyle was accentuated further last week by National Audit Office research showing that the gap in life expectancy between an average person and someone from the poorest sectors of society has widened significantly in recent years due in part to factors such as poor diet and smoking.

 The assumption underpinning these reports appears to be that living longer is a “good thing” even though for many it means living longer in poor health. But – even for those who due to their genetic disposition, economic and social background, and lifestyle are likely to live longer in good health – this development must raise the question of whether some would want to.  If people are able to plan their life based on a very reasonable certainty of how long it will last, surely there will be those who will also want to plan when it should end? Also this week, Ludwig Minelli, the head of Dignitas (the assisted suicide organisation) gave a major interview in which he maintained that the end of life decision should also apply to healthy people without mental illness – certainly a point worthy of debate in this context?

 Undoubtedly thus far the Boston research raises more questions than it answers. Perhaps its greatest contribution is that it moves us closer to a situation where, as Professor Perls said, “Exceptional longevity is not this vacuous entity that no one can figure out”.

For further information see:

http://news.bbc.co.uk/1/hi/science_and_environment/10475018.stm

 http://www.dailymail.co.uk/sciencetech/article-1291242/That-genetic-test-predicts-live-100-Scientists-pinpoint-19-markers-long-life.html

 http://news.bbc.co.uk/1/hi/health/10490927.stm

Towards a better pensions and retirement framework

Last Thursday I was very pleased to attend the first seminar of the recently formed Centre for Retirement Reform (CRR) at The Institute of Directors in London.

“The CRR is a new think tank and lobbying body set up to help bring about the reform necessary to produce better retirement outcomes for the people of Britain. Although the pensions arena continues to go through change and restructuring, to date this has fallen well short of the root and branch reform required to address the biggest issues affecting retirement now and into the future.

The CRR believes three fundamental changes are necessary:

1. State retirement age needs to be raised to 70 as soon as practicable; sensible transitional arrangements are perfectly possible.
2. The existing state pension benefits system should be replaced with a simple, universal state pension at or above the current means tested level – a change that can be self-funding.
3. A new long term savings product structure must be developed to replace the current private pension model as it is no longer fit for purpose.”

The seminar was very well attended and the speakers were excellent. I, personally, was particularly impressed by the words, insights and passion of Alan Pickering discussing the need for a decent, universal State Pension.

Trying to grapple with the plate of spaghetti that now constitutes the UK’s pension and retirement system and, furthermore, to simplify it and structure it in a way that is understandable and acceptable to the majority is a task indeed!

The initiative is timely and we wish them every success.

For more, visit the CRR website at http://retirementreform.org.uk/index.php

Pensions – it’s all relative

There is much that could be said about yesterday’s decision to increase the state pension age for men. But most of it has been said elsewhere.  

What it did throw into sharp relief was the notion of relativity. The London Evening Standard (and no doubt other places) reported that if the state pension age had gradually been increased in line with increasing life expectancy since the state pension age was first introduced, the age for claiming it would now be 75.  

And yet, in France, there is major complaint about the fact it is being increased to age 62.  

It underlines the fact that basic human behaviour and attitudes change very little whatever the situation. If you want to change something do it subtly and slowly over a long period of time. Assuming the underlying proposition is reasonable, people then find little to complain about.

Don’t grow old?

This week’s Horizon programme on BBC2, Don’t grow old investigated scientific research into ageing – and by so doing generated much food for thought.

Apparently great strides are now being made into finding out why we age, why some age faster than others, the causes of many age-related diseases, and what we can and perhaps should do on an individual basis to counteract the effects of age.

If those interviewed are to be believed it is only a matter of years before we can all access pills to help us live longer. Under such circumstances, living to 120 or more will be commonplace.

In light of how we now view age and its symptoms, in a society which currently views 60 as “old”, the implications of this are huge.  What quality of life can be guaranteed throughout these extra years in terms of health, wealth and happiness? Who will pay for such longevity? What will be the implications for family life and the rest of society at all sorts of levels?

If such research can help eradicate or restrict degenerative diseases such as arthritis and Alzheimer’s, then it will be achieving great things.  Ultimately our aim should surely be about improving the quality of the years we have and ensuring we have a quick and dignified end rather than enabling years of living longer simply because we can?

Already we demonstrate that as humans we are not always great at keeping pace with scientific and technological developments in the world in terms of attitudinal change and responsibility. Surely then our focus should be on counteracting the problems inherent in  the lives we already have, rather than creating a facility for enabling those problems to go on for far longer?

That aside, one has to hope that this research will have the same effects as the work that went into space travel. It wasn’t landing on the moon per se that was the most important achievement but all the beneficial scientific discoveries and inventions (many of which we now take for granted) that emerged along the way.

“Building a society for all ages”

The deadline has now passed, at least for the moment, to make your voice heard to the government over their proposals outlined in “Building a society for all ages” a document which focuses predominantly on the issues surrounding our ageing population. The issues are very wide-ranging and extremely important.

We here, at in my prime, made our own representations in the fields in which we operate and if you are interested in seeing what we had to say please click here 

To read the original government document click here