PwC pensions head proposes state pension window

PwC pensions head proposes state pension window

A state pension window should be introduced to give savers more freedom on when they retire, an actuary from consultancy firm PricewaterhouseCoopers has said.

Raj Mody, partner and head of UK pensions at PwC, said: “We are living longer than ever before and staying fitter for longer. That is good news, but it brings challenges.

“These challenges include defining what retirement represents and how society can continue to benefit from the wealth of experience accumulated by those of greater years.

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“A more immediate challenge is how we make sure that we bequeath to future generations a state pension system that can be afforded.”

His comments followed the publication of PwC’s 41-page paper, One Size Fits None, which raised concerns about the cost of the state pension to society as people spend more time in retirement.

According to the paper, providing a state pension window would allow people to choose when they begin receiving state pension within an acceptable age band.

This would be based on a ‘pivot age’ that would help determine the amount of state pension payable depending on when in the window an individual chose to start their state pension.

Adviser view

Adrian Murphy, a partner at Glasgow-based Murphy Wealth, said: “The state pension is not fit for purpose at the moment because for people who rely on it, it is simply not enough.

“Having a state pension age is a bit arbitrary now because people retire at different times.”