Millions See No Point In Saving For Retirement

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Millions of over 50s have given up on saving for retirement because they believe their money will only be grabbed by the government to cover care fees.

They feel they will receive the same care whether they save or not, so see no point in saving money for their later years when others who have made no provision receive the same retirement benefits.

The figures come from research by AgeUK, the biggest charity working with the elderly.

The charity included the research in lobbying information put before MPs who are soon to debate an overhaul of care rules in Parliament.

Various studies by the government and other bodies in recent years have suggested care fees should be capped.

Cap on care costs

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A government inquiry suggested the limit should be set at £35,000, but other reports and government departments have hinted at a higher figure somewhere between £50,000 and £72,000.

Besides introducing the care fees cap, the bill before Parliament also covers how to assess how frail someone who is elderly has to be before qualifying for care and a pledge that pensioners do not have to sell their home to pay for care.

AgeUK claims a million elderly have had to sell their homes during the past five years  to pay care costs, while the London School of Economics reckons almost 500,000 elderly are considered to well-off to receive free care  even though they would have qualified only a few years ago.

The government wants to give people certainty about how much money they need to save for retirement and care costs, and some idea of what will happen to their homes.

No confidence in care proposals

However, research suggests that arguments from ministers have failed to give those approaching retirement confidence in the care system.

A survey by market researchers TNS revealed around a third of over 50s are not saving for care in retirement because they do not believe promises about protecting their home will materialise and that those with comparatively modest savings of £30,000 or so will have to pay.

The number of non-savers adds up to around 3.8 million over 50s.

Ruth Isden, of AgeUK, said: “Any government decision that does not encourage people to save for their retirement is the wrong decision and sends the wrong message to all generations. People need to know how much they need to save so they can make the right financial plans.

“The government needs to take a positive lead with a clear and fair policy for everyone.”

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1 COMMENT

  1. The problem is a lack of education about retirement and retirement planning. This is something that should be taught in every school alongside reading, writing and arithmetic. The key is to start saving/investing early in life and be consistent about it. There is a great deal of information about retirement available on the web. I found several sites very useful including the site Retirement And Good Living which provides information on finances, health, retirement locations, part time work and also has a great blog of guest posts about a variety of retirement topics.

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