We are “woefully underprepared” for our ageing society. That was the conclusion of the House of Lords Select Committee on public service and demographic change chaired by Lord Filkin earlier this year.
Central to that is the fact people just aren’t saving enough for retirement and their later life. New research for Age UK has found that just under a quarter of people aged 50-64 – those rapidly approaching state pension age – think there is no point saving.
Worryingly, that is not because the majority have already made provision for their future. More than a quarter said they were worried about having enough to live on. Only 15 per cent thought they had saved enough already.
We also frequently hear from older people about the problems they face with money matters, and the lack of solutions that really work for older people. While auto-enrolment is a massive step forward, it will not have time to reap its full benefits for people close to retirement.
That’s why we’re launching the Financial Services Commission – which I will co-chaired with Dr Alexander Scott of the Chartered Insurance Institute.
Launching on 5 December, it will be take the form of a series of three summits in which we will work with key industry leaders and consumer experts to examine how to improve the “financial resilience” of older people – their ability to weather the challenges that might lie ahead.
The commission will culminate in June next year with the publication of a roadmap of actions that regulators, government and industry need to take to help keep future and current pensioners financially resilient.
We have chosen to focus on resilience because we think it’s an important indicator of whether people will thrive in later life. As we enter our later years, it is not our finances alone, but our accumulated health, social and financial resources that are crucial to our standard of living and well-being and our ability to withstand shocks and difficulties.which can derail plans over-night.
Our rapidly ageing population makes this among today’s most pressing issues. By 2025, a fifth of the UK’s population will be aged 65 and over. This increased longevity is absolutely to be celebrated but every part of society needs to adjust.
It is also a huge opportunity for those in the financial services industry who can provide products and services that really work for older people and enable them to become and remain resilient.
The Commission will focus on three key later life stages with the first summit, held this Thursday, concentrating on 50-64 year olds and whether it is too late to save. This will be followed by the second in February which will focus on how the recently retired can best maximise their income and in March by the third summit which will look at how those in later older age – the fastest growing segment of our population – can stay financially included.
We are confident that by bringing together industry leaders, regulators and experts on the needs and aspirations of older people, the Financial Services Commission will be able to come up with some tangible ways forward to help older people to remain financially secure, plus identify some new markets and products for the financial services industry.
Tom Wright is group chief executive of Age UK