Here in Britain, it’s become clear that those of us who have saved our money instead of spending it are actually being punished for this instead of being rewarded as we should be. People who’ve reached retirement age are those who are being worst hit, and there really is a growing resentment amongst people, pensioners in particular that they’re being hit by the poor rates of return.

The Government, just a few days ago, announced plans that it was going to change the way that some private sector pensions are calculated. Experts are now warning us that this will result in lower payments during retirement for those people affected.
Now I’m not yet a pensioner, but I am one of those people trying to save for my pension, and right now I’m worried about the current situation, and by the attitude of existing pensioners – particularly those who’ve retired recently and been hit by very poor annuity rates. It seems that pensioners themselves are probably the worst advocates of saving for a pension at the moment because they’re looking around them and seeing that here they are having saved all this money towards the day when they’d retire and funnelled as much as possible into their pensions, and now the payouts are poor and they’re going to struggle instead of being able to enjoy their retirement. Around them of course, are people who didn’t save very much, but who did enjoy their money while they had it, and who have all their luxuries and comforts already bought and paid for.

The recently announced annual Scottish Widows Pension Report has revealed that it’s women over 50 who have been hit hardest by the current national financial situation, and that as well as pensioners who’ve recently retired seeing poor annuity rates, those with money in bonds and individual savings accounts have also seen rates plummet during the recent financial crisis. For those people, for whom their savings have until recently provided them with a reasonable income to live off, now they’re struggling because of the poor rates of return on offer to them.

The effect that all this is having on the number of people who are currently saving towards their pension shows a definite down trend in saving for retirement. For example, last year, 52% were saving adequately compared to this year when just 38% of people are doing so. For women over 50, the percentage who are not saving at all for their retirement has gone from 22% last year up to 26% today.

Experts have called on the Government to take action now and increase the basic state pension, and discard pension credit. Of course the problem there is, that this would cost money and right now it would appear that the Government doesn’t have any left. I do believe however, that in the longer term we could see this approach being taken. For one thing, until the coalition was formed, this was one of the Lib Dem’s staple policy’s.