Almost one in five (18 per cent) people don’t believe the state pension will exist by the time they retire, according to research by Hargreaves Lansdown.
In a survey of 2,000 people carried out by Opinium on behalf of Hargreaves in September, a quarter (26 per cent) are unsure if they will receive the state pension and more than half (57 per cent) think it will exist.
The younger the individual, the less likely they were to believe the state pension would still be around by the time they retire.
Only 38 per cent of 18–34-year-olds believe the state pension will still exist by the time they reach retirement age.
Meanwhile, 83 per cent of over 55s believe it will be around - compared to 42 per cent of those aged 35 to 54.
Helen Morrissey, head of retirement analysis at Hargreaves Lansdown, said: “The state pension is the backbone of our retirement income, and yet the constant merry-go round of change means almost one in five of us don’t think it will exist in the coming years.
“We are all living longer, and this has pushed up costs. Added to this the triple lock looks set to deliver an eye watering 8.5 per cent increase in state pension next year.
“This is on top of the enormous 10.1 per cent boost awarded back in April - great news for pensioners who have been struggling with the cost-of-living crisis but also an enormous financial headache for the government.”
Morrissey said there were levers the government could pull to try and contain the cost, with one being to tinker with the triple lock, so increases were not as high as they have been.
“We saw this during the pandemic when furlough inflated wage data, prompting the government to opt for the lower inflation figure instead,” she said.
“We may well see this happen again, given the contribution one off bonuses to the NHS and civil service have made to high wage data. If this is the case, it gives further evidence to the case to either change or scrap the triple lock.”
She argued that the other option was to increase the state pension age which has happened already, with a recent review on accelerating the shift to 68.
The government opted against this in the end, but it will be revisited in future.
Morrissey said the challenge for the government was to not raise the age too far, since many would be forced to work longer than they were able to and some won’t live long enough to claim it.
“It’s no wonder that all this change means there’s a view, particularly among younger people, that the state pension is under threat,” she said.
“Given its importance as the foundation upon which we build the rest of our pension planning, we need to see real long-term thinking in this area with an overarching review to ensure it remains sustainable long-term and allows people to plan their retirement with confidence.”
sonia.rach@ft.com
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