10 May 2022

Avoiding the future cost of living (in retirement) crisis

4 min read

Jamie Jenkins, director of policy and external affairs at Royal London, said:

“As anticipated, there was little in the way of pensions news in the Queen’s Speech. In practice, there is no shortage of activity on pensions with a national awareness campaign starting later this year, followed by the launch of the first Pensions Dashboard in 2023.

“However, we do need to consider how we build on the success of automatic enrolment, which reaches its 10 year anniversary later this year. The recommendations of the 2017 review – removing the Lower Earnings Limit on contributions and reducing the minimum entry age to 18 – have still to be firmly planned. It looks increasingly unlikely that this will be implemented by the mid-2020s target.  

“Beyond that, we need to give employers and employees notice if we are to move contribution rates up from their current 8% level, a move which now seems to carry widespread consensus.

“The cost of living crisis we face today is rightly the focus of attention for now, but we face a bigger cost of living crisis in later life if we don’t start to address the adequacy of pensions saving soon.”

About Royal London

Royal London is the largest mutual life insurance, pensions and investment company in the UK, with assets under management of £150 billion, 8.8 million policies in force and 4,262 employees. Figures quoted are as at 30 June 2022. Learn more at royallondon.com

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