retiring later, preparing younger

A recent Office of National Statistics report predicts that by 2051, life expectancy for men aged 65 is projected to be 25.9 years; for women aged 65 it is projected to be 28.3 years [1]. Whilst this is positive news, this will put increased pressure on the pension system with the government recently announcing that the state pension age is set to increase to 65 for women by November 2018 and to 66 for both men and women in October 2020 [2]. With a longer wait to access a state pension, there is an increasing need to save for retirement. Worryingly though, statistics from the Department of Work and Pensions show that only 17 per cent of those aged 18-24 agree that they are putting away as much money as they can to prepare for it [3]. We've enlisted some helpful ways in which young people can start saving for pensions and retirement.

1. take advantage of company pension schemes

Don't put it off, invest in a pension as soon as possible. A lot of company pensions will match the amount of money you invest each month, so it's worthwhile taking one out if you can. If you're curious about how much retirement income you could receive, the money advice service pension calculator can help.

2. save as much as possible as early as possible

It's pretty obvious that if you start saving for your pension early, you can accumulate more money in the long term, but saving is not always easy. Moneysavingexpert.com advises using the ‘pay-rise trick' whereby each time you get a pay rise, you immediately put a quarter of it into your pension each month [4].

3. gain advice from financial planners

Consult the experts for advice - they know best. There are plenty of websites that offer free guidance about pension planning to help you to maximise savings for the future. 

¹ http://www.ons.gov.uk/ons/dcp171780_255969.pdf%20 

² http://www.direct.gov.uk/en/pensionsandretirementplanning/statepension/dg_4017919

³ http://research.dwp.gov.uk/asd/asd5/WP72.pdf

⁴ http://www.moneysavingexpert.com/savings/discount-pensions