Decisions - Longevity - making retirement work.

(From Financial Director)

Byline: Anthony Harrington.

The English language is rich in hoary old sayings like 'now't for Snow't', or the impossibility of extracting red corpuscles from a rock.

We feel the truth of these bits of wisdom in our bones but, in some Sstrange way, they have a tendency to vanish when the mind turns to musing Son retirement.

Pensions are founded on a simple belief in the magic of compound Sarithmetic. Put a little aside and it will grow into a glorious mountain Sof cash decades later. However, take this multiplying factor out of the Sequation. Imagine, instead, that every pound you are ever going to need in Syour retirement will have to be set aside during your working life. The Swhole business of saving for one's retirement, on these terms, will Srapidly seem like an incredible grind.

If you add to this picture the notion of increasing longevity, the picture Stends to get worse. Trying to save a sufficient sum in 30 years to retire Sfor 30 years does not seem a particularly achievable task, in these terms. SThe very notion of retirement becomes moot quickly.

Which brings us to the Turner report on pensions, which summarises the Snecessity of either retiring later, possibly much later, or saving harder Sif we want a decent pension. Longevity and the probability of low returns Son investment being the norm for decades to come are at the root of these Stough alternatives.