I will not speculate on what he might do, you can read bucket-loads of that elsewhere. I will say it’s unlikely one Budget will sort out the problems.
What is more realistic is that he will have only a small impact on the long term issues that face pension savers and here I’m a little more hopeful.
A useful study by the Institute of Fiscal Studies think tank out this week found that pension savers were taking a more practical attitude to their retirement plans than people give them credit for. Put simply they are putting off retiring.
The IFS, which used the ONS’s huge, long-term Wealth and Assets Survey (WAS) of 20,000 households, found that savers were more likely to have a pension than 10 years ago thanks to auto-enrolment but more were expecting to retire much later than their parents’ generation.
For some that’s a matter of choice, for many I suspect it’s Hobson’s Choice.
The IFS says that of those expressing an expectation, 20% of middle aged people (40–54) reported expecting to retire at age 67. This compares with less than 1% of men and women surveyed a decade earlier. That’s a huge change.
However, despite men and women in this age group now having the same state pension age, women on average still expect to retire earlier, by almost 1 year (at age 64.2 compared with 65 for men). That’s probably a legacy of women being able to retire at 60.
The average age at which men and women aged 40 - 54 expect to retire increased substantially between 2006 and 2017, says the IFS, by 2.1 years (from 62.9 to 65) for men and 2.4 years (from 61.7 to 64.2) for women.
The skill of Financial Planners will increasingly be to help clients who want to retire earlier to plan to do so much earlier than 67. The reality for most people is that without good long term Financial Planning advice (or winning the lottery) retiring much before 67 will be no more than a dream.
Kevin O’Donnell is editor of Financial Planning Today and a financial journalist with 30 years experience. This topical comment on the Financial Planning news appears most weeks.