Worried 25 year old

jh2009

no_fat_chicks wrote: »

So it won't become nothing, instead, it will become nothing? Did I read that right?

I dont think it will become nothing. It will just over time become worth less in relation to average earnings/prices, and end up more of a safety net to the very poorest.

You would i think be able to survive on it .... but for any sort of enjoyable retirement you wouldn't really want to.

The current state pension if topped up to the current minimum income guarantee is just under £7000. So you have to imagine relying solely on that sort of income, in todays terms, from state pension age if you make no provision or work after state pension age.

Also it will be payable from a later age, currently 68 for those born after april 78. This may well go up to 70.

Of course we dont know politically what could happen in the future. Its not impossible a majority of a generation of 20/30s year olds today will have made little/poor provision, and will demand en masse the government helps them. I think thats why NEST is being introduced to help try and avert this to get more to save, so i guess in any saving there is a danger for those prudent enough to save being means tested. But i dont think you can use this as an excuse not to save.

I think its best to prepare for the state pension being a mere safety net you wouldnt want to live on, and any saving through pensions/isas/savings/etc being used to top up this and give you the best chance of having some options as you approach retirement.