Retired workers will continue to have their state pensions protected by the triple lock guarantee, according to a commitment made by Boris Johnson yesterday.
The triple lock is a legal guarantee that the state pension will rise in line with the highest of average earnings growth, inflation or 2.5%.
It was introduced in 2011 to ensure that the average pensioner household income increased each year regardless of their economic circumstances.
Many people dream of having a relaxing retirement and being able to spend more time with their loved ones. However, increasing numbers of people are working once they hit retirement age.
One in seven people aged 65 or over is still working - more than half of whom are working full time or are self-employed, figures show.
Four out of 10 work part time, while one in five have two jobs or more.
The insurer Sunlife questioned more than 3,000 people aged over 50 for its report Finances After 50.
Over-55s who take money out of their pension pots during the coronavirus crisis may have to claw back larger than usual tax overpayments from HMRC, pensions consultancy LCP has warned.
Global stock markets looked to have bounced back from a torrid February and March, but yesterday’s sharp drop in the FTSE 100 warned investors there could be more turbulence to come. But it’s not all bad. There are ways you can use falling markets to your advantage when it comes to financial planning.
Since the pension freedoms were introduced five years ago, a total of £600 million has been reclaimed by savers hit by a punitive ‘emergency tax’.
Pension freedoms figures: notable rise in withdrawals, but five-year data shows more measured approach being taken
Pension freedoms figures released today by HMRC revealed 348,000 people accessed their defined contribution (DC) pension pot in the first quarter of 2020 – an increase of 23% over the same period last year.
The figures also showed that the total amount withdrawn from pensions over the first quarter, £2.46 billion, is up 19% year on year. However, the average amount withdrawn fell by 3%, to £7,100 from £7,300.
Savers considering transferring from a final salary or defined benefit (DB) pension to an investment-based defined (DC) pension during the coronavrius crisis will be warned that doing so is unlikely to be in their best long-term interests, in a letter from regulators.
Greater flexibility around taking an income from a pension also comes with greater risk. Unlike an annuity, which will last as long as you do, there’s a danger that without the right investment and income decisions, your pension pot won’t stay the course.
If you are receiving a final salary company pension or expect to receive one in the future, high-profile corporate failures such as those of BHS and Carillion serve as a reminder that your pension is only as secure as the company running it.
To be more precise, some of your pension may be at risk if your current or former employer goes bust at a time when there is a shortfall in its pension fund. But how likely is this, what safeguards are in place and what are the pension authorities doing to ensure your pension is safe?