New State Pension
The government has announced plans for a new flat-rate state pension that removes means-testing and which it hopes will provide clarity for everyone saving for their retirement.
Why the change? Since the Beveridge Report set out the plan for the welfare state 70 years ago, Britain’s demographics have changed dramatically. In the 1940s a minority of men could expect to live to 65 whereas 36% of people born in 2013 are expected to live to 100, according to the Office for National Statistics. In other words the solution has to be affordable.
The single-tier pension will be implemented in April 2017 (at the earliest). It will see pensioners who qualify receive a £144-a-week state pension.
But who can really live off £144 a week today, or if as a couple you qualify for 2 x £144 a week, this level of income will be quickly swallowed up by living expenses. The need to save still sits firmly within our own hands, so don't leave it till the last minute, make it part of your lifestyle.