Scrapping the default retirement age
Informed Choice chartered financial planner Martin Bamford was quoted in Money Marketing this week, in an article reporting on proposals to scrap the default retirement age.
Pensions minister Angela Eagle was speaking at the Public Sector Pensions conference in London this week, and said that people should be able to work for longer if they were fit and able.
This approach makes perfect sense.
Having an compulsory age at which people must stop working disadvantages those people who need or want to work for longer. It prevents some people from continuing in paid employment, even though they are perfectly capable and can continue to add massive value for their employers.
There is another important side to the argument as well.
Having a default retirement age in place gives people a very clear target. It means that plans for income in retirement, including important investment decisions, can be tailored with a specific date in the future in mind. Removing the default retirement age could make retirement planning much more personal and much more complex.
Quoted in the Money Marketing article, Martin said:
“I think that there are pros and cons to scrapping the default age. While, as adults, we should have the freedom and flexibility to choose when we retire, people like a point of reference that gives them a goal during their career.”
What are your views?