Thursday, 22 January 2015

A faltering finale

A survey of people's biggest worries found that after number one (being overweight), the next two were getting old and their financial future.

I'm not surprised by those two. They're two of my worries as well, for the simple reason that I have no idea how long I'm going to live, no idea how much it'll cost me, and no idea if I'll run out of money. The future is largely unknowable and all sorts of unforeseen events could put a spanner in the works.

My worries also stem from the fact that we live in a very ageist society where vulnerable old people are often ignored or mistreated, and not given the help, support and respect they deserve after a lifetime of work, often in vital services like the NHS. I can't be confident that if I fall on hard times other people will come to my rescue and make sure I'm okay.

And I'm one of the more fortunate ones. I've benefited from a lifetime of rising property prices, I haven't had any children to pay for, I'm still fit enough to work, and I have no money-draining addictions.

Today's young people are in a much worse position when they contemplate the future. The state pension is being steadily eroded, but they have little money to put into a private pension. They have tuition fees to repay, they're stung for massive rents and mortgages, bringing up children is more and more costly (£230,000 a child at the last count), and wages are being ruthlessly slashed through zero-hour contracts, part-time work and a skinflint minimum wage.

Many young people can barely get through the week, let alone save anything. No wonder they often look totally blank when asked about pension plans.

Old age should be a a time of carefree enjoyment, not gnawing financial worries. Old age should be a joyous finale to a strenuous life.

Pic: Beatrix Ost, New York artist and writer

34 comments:

Grannymar said...

This is why it is important to live in the now. I remember the mother of a girl I was at school with. She and her husband never went on a holiday. She was waiting for her four daughters to finish school and her husband to retire. As we approached our Leaving certificate and six months before the husband retired, the mother dropped dead. There was no holiday or future for her.

Live now Nick while you can.

Bijoux said...

I most worry about my health, which I suppose is tied to old age. If you do not have your health, you don't have anything. All the money in the world can't save you from horrific diseases. Look at Steve Jobs.

Wisewebwoman said...

I'm with GM on this. Though telling you not to worry is too facile.

You are a worrier but you have the advantage of DINK unlike me with only government pension, single and the odd bit of grant/employment/workshops thrown my way.

I only allow myself to worry 5% of the time. 95% is carefree about the future. I could be dead.

XO
WWW
PS My previous comment went AWOL.

Nick said...

Grannymar: That goes to show that you can plan as carefully as you like for the future, but something quite unforeseen will throw all those plans into disarray. As you say, the best thing is to live in the present and just let things happen.

Bijoux: Bad health can alter your life drastically. I'm fit and healthy while my sister has Motor Neurone Disease. However she imagined her future when she was young, things have turned out very differently.

Nick said...

www: If you only worry 5% of the time, that's pretty good going! Indeed, being dual-income no-kids is a big advantage financially. Households with only one income are often in serious difficulties unless that income is substantial.

Secret Agent Woman said...

You know, the with the live in the now idea is that while it's true we may not have tomorrow, it's also true we may have many, many tomorrows and those have to be financed somehow. So I think you have to find a balance between enjoying today while saving for your future. Personally, I don't want to be destitute when I'm old.

CheerfulMonk said...

Andy and I were savers, and we had only one child. I never felt deprived because I don't like to be burdened with a lot of material things. We spend a lot on our place up in the mountains now, but Andy loves it and it's good for his physical and mental health. I've told him more than once I don't worry about the money he's spending as long as he's happy. That's priceless.

Nick said...

Agent: I'm a firm believer in adequate state pensions (which we're all paying for anyway), with private top-ups only if you want a bit extra. To save for the future solely with a private pension scheme costs a huge amount of money, which many people can only afford if they stint themselves for decades. And then they might drop dead before they get their pension!

Nick said...

Jean: You seem to have plenty of money available, presumably from pension schemes you've paid into over a long period. A very fortunate position to be in. Especially with the cost of medical care in the States!

Jane and Lance Hattatt said...

Hello Nick,

Well, we love the picture of Beatrix Ost which you use to illustrate your post. She is definitely a role model who, with luck, can show how fulfilling life can be as one grows older.

Health is the most significant factor since, without that, all else is much more difficult. But, in our view, maintaining a healthy interest in things, being curious and keeping a wide circle of interesting friends of all ages are keys to maintaining a happy old age.

Helen Devries said...

Provision of a proper state pension should be a priority in any society...to remove the anxiety of wondering how to manage, especially for those without a supportive family.

None of us know what could be lurking round the corner of the future...so we try the balancing act of doing as much as we can now while not breaking the bank (banks seem capable of doing this without our assistance). Luckily interest rates are high for savers in Costa Rica....

Nick said...

Jane and Lance: I chose (pinched) that pic totally at random, and didn't realise it was Beatrix Ost, New York artist and writer. Very happy to do her the courtesy of naming her! And how stunningly glamorous she is.

I agree with your ingredients for a happy old age. I think curiosity is essential to keep the brain alert. I know people who seem to have no curiosity at all about anything, and how dull and boring they are!

Nick said...

Helen: Our state pension is one of the meanest in Europe. We get a scandalous £7,500 a year, while pensioners in Spain, Germany and Sweden get between £25,000 and £27,000. No wonder Brits are so worried about their financial future.

Secret Agent Woman said...

You have to work for the government or a big company here to get a pension. And social security is anything but secure anymore. Saving privately is my only option. If I don't, I can count on living in poverty when I'm old. Or working full time until I drop dead. Neither appeals, so I think I'll keep putting money in my retire,met account.

Nick said...

Agent: If you have enough spare cash to put into a pension fund on a regular basis, that's a sensible move. But private pension providers in the UK have been guilty of a whole series of scandals, such as charging massive management fees, abruptly devaluing pension schemes by 25%, and persuading people to buy inadequate annuities.

Secret Agent Woman said...

My point, Nick, is that I don't really have a choice. It's not "spare cash," it's a retirement fund that I am expected to set aside if I don't want to be homeless. It's not about wanting to live in luxury someday, it's about not wanting to starve. I do without other things in order to be able to support myself when I retire. There is no such thing here as a pension for someone who is self-employed.

Nick said...

Agent: Ah, it didn't click that you had to provide for yourself because you're self-employed. But I guess it's still true that while some self-employed people can afford to contribute regularly to a pension/retirement fund, others may have too precarious an income to do so.

susie said...

I didn't know who the woman was in the photo until I read through the comments. She is 71 in that photo. I was curious.

Nick said...

Susie: Seventy one, eh? Well, there you are, you can look glamorous at any age. All you need is a bit of flair and panache.

Stephanie Faris said...

Finances would be top on my list. I find it interesting that the other two are so appearance-based. Why are so many people so concerned about their looks? The interesting thing is, the older you get, the more you focus on what's inside of you and other people and less on how they look!

Nick said...

Stephanie: The constant obsession with looks is totally absurd, but I can't see any end to it. I think the problem is that the first thing you notice about someone new is their appearance, as their brain and personality are hidden. So their looks are the first thing we judge them on, even though it's obviously superficial.

But like you, as I get older I pay less attention to appearances and look for what's underneath.

Nick said...

Mind you, fear of getting old could mean two different things: either fear of looking old - lines and wrinkles etc, or fear of being decrepit and needing other people's help. I'm not bothered by the first but I'm bothered by the second.

Keith said...

I have family in France and my cousin, a French national, came for a holiday last year. When we compared notes she was shocked at how little pension we get here, and said she didn't know how I survive on just a state pension. You are right, she gets the equivalent of £26,500 a year + some free medical care.

I try to live just for each day, gave up worrying about money and death. It's inevitable and worrying will only accelerate it coming!

Nick said...

Keith: I'm not surprised she was shocked - it's such a huge difference between pension levels. Yes, too much worrying achieves nothing except permanent unease.

kj said...

hello nick,

i've come here from secret agent and enjoy this discussion. i agree that too many people and families do not have the option of future savings; that they would if they could.

in my life and my circle, i am lucky to be able to anticipate a scaled down but comfortable life ahead. still, that 'best' balance is not easy to figure. i should probably put that extra $ 5000 into reshingling my house, but then again, maybe i should build up my retirement account. for those of us fortunate enough, it's often a choice among choices.

nice to meet you,
kj

Nick said...

kj: Hi! Exactly, many people simply don't have the spare cash to put into a private pension fund even if they wanted to. Certainly not for 40-plus years which may include periods of unemployment, minimum-wage jobs etc. And if we have no idea how long we're going to live, we have no idea how big a pension fund we'll need. Which is why I support an adequate state pension, paid out for as many years as you need it, financed by the tax and National Insurance payments we all make throughout our working lives.

I'm not sure what the situation is in the States. Does the US even provide a state pension?

kj said...

Nick, the US provides Monthly Social Security payments available at age 62 or 66. Approx. based on a decade of earning an average of 40,000 a year, you could expect about $2000 a month--not horrible. I've been self employed most of my career so I wisely have pursued the tax benefits if paying into my own retirement fund as well. Good that I've been able to do that.

I do know some folks who do not plan ahead and some that work and then don't work. I couldn't stand living that way. I'm a back door plan b just-in-case person

Thanks for your visit :-)

Rummuser said...

"Old age should be a a time of carefree enjoyment, not gnawing financial worries. Old age should be a joyous finale to a strenuous life."

By that definition, I am living the life that you wish for. I am however confronted with health problems that can only be understood by people with them. I don't worry about them and just get on with having fun despite them.

I believe that it is all about one's attitude towards life.


Nick said...

kj: $2000 a month is around twice the average UK state pension so even the USA is more generous than the stingy British government.

You're very sensible to have a retirement plan in place rather than leaving everything to chance.

Nick said...

Ramana: Unexpected health problems can greatly reduce quality of life. It's good that yours aren't serious enough to be a constant burden.

Ms Scarlet said...

I will have to set up a Bloggers retirement home... just give me a weekly fee from now on and I'll see what I can do :-)
Sx

Nick said...

Scarlet: Brilliant idea. The Leafy Glades Rest Home for Knackered Bloggers. Motto "Visible after Approval". I tried to send you my enrollment fee but I kept getting the message "Sorry, something went wrong, try again later."

Liz Hinds said...

It is scary to think of the future we're handing on to our children.

It is so horrendous for young people to be starting out on life already in debt with student loans to repay. And my children are more fortunate than some in that we paid fees and expenses. Education is no longer for all I'm afraid.

Nick said...

It's a very scary future for the young, and getting worse all the time. More and more young people are living with their parents as they simply can't afford a separate home. And loading huge tuition fees onto people acquiring vital skills that benefit the whole of society is simply scandalous.