Comment on Longevity issues in respect of proposed changes to the state pension.
06 April 2011
Joseph Lu, longevity expert at Legal & General commenting on the government announcement on changes to the state pension said:
"Since the establishment of state pension ages of 65 for men and 60 for women in the late 1940s, the life expectancies of men and women at state pension age has increased by nearly 6 and 7 years respectively. This means that people can expect to spend more years in retirement than the pensioners who first received the state pensions more than 60 years ago.
However, according to figures from the Office for National Statistics, the life expectancy at age 65 for people in more deprived circumstances can be 3.5 years less than those who have a good lifestyle. So the changes announced would mean that some people could receive less state pension in total, because although they would receive the same pension amount it would be for a shorter period of time. There will be some winners and some losers, which is where a regular review process would enable the state pension age in the future to reflect changes in longevity.
For those who are healthy and likely to live longer, it is not so surprising that they may like to spend part of their time after state pension age working, especially if their contribution is valued and appreciated.
What is important for everyone at retirement with additional pension savings, is that they shop around to ensure they get the maximum pension income possible for their retirement, however long that may be."
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