A report published by the World Economic Forum (WEF) has called for the retirement age in financially stable countries to rise to ‘at least 70’ by 2050, in line with increases in life expectancy.
The report revealed that babies born in 2017 can expect to live to at least 100 years old. As a result, it suggested that individuals in nations such as the UK, US, Canada and Japan may have to work until at least age 70. The UK state pension age is already set to rise from age 65 in 2018 to 68 by 2046.
Policymakers have been urged to consider a handful of key strategies in order to help alleviate the situation. Governments should encourage individuals to save regularly within savings products, and should also review their national retirement age.
The WEF also called for education systems to teach financial literacy.
Michael Drexler, Head of Financial and Infrastructure Systems at the WEF, commented: ‘The anticipated increase in longevity and resulting ageing populations is the financial equivalent of climate change.
‘We must address it now or accept that its adverse consequences will haunt future generations, putting an impossible strain on our children and grandchildren.’
Figures published by Financial Fraud Action UK (FFA UK) have revealed a significant rise in the amount of money stolen from contactless bank cards and mobile devices.
Contactless spending rose from £7.75 billion in 2015 to £25.2 billion in 2016. The data revealed that nearly £7 million was stolen in 2016, compared to £2.8 million in 2015.
However, FFA UK also stated that fraud on contactless cards and mobile devices equated to just 1.1% of total card fraud.
In order to combat contactless card fraud, consumers have been urged to never hand over their card at the point of payment, always ask for a receipt when purchasing goods and review financial statements regularly to check for unusual transactions.
Richard Koch, Head of Policy at the UK Cards Association, said: ‘All contactless cards contain robust security features including an in-built security check which triggers the need to enter a PIN at certain points.
‘Customers are fully protected against any losses and will never be left out of pocket in the unlikely event they are the victim of this type of fraud, unlike if they lose cash.’
The British Chambers of Commerce (BCC) has urged UK businesses to prepare for the implementation of new data protection regulations.
Starting from 25 May 2018, businesses that hold personal information will be required to ensure that their data procedures are adequate and that these comply with the new General Data Protection Regulation.
The BCC has recommended that businesses make a record of what personal data the firm holds, where it came from and who it has been shared with.
It also urged firms to review how the company ‘seeks, obtains and records consent from individuals’, ensure that appropriate procedures are in place to detect a breach in personal data and determine whether the business requires a Data Protection Officer.
David Riches, Executive Director at the BCC, commented: ‘Businesses need to be proactive about ensuring they are ready for the new data protection regulations when they come into force this time next year, and not leave preparations until the eleventh hour.
‘Those firms that don’t fulfil the necessary responsibilities leave themselves vulnerable to tough penalties, not to mention public scrutiny.
‘The General Data Protection Regulation is intended to reflect modern working practices in the digital age, and will strengthen consumer trust and confidence in businesses.’
An analysis published by the Trades Union Congress (TUC) has suggested that unsecured debt per UK household will reach a record high of £13,900 over the course of this year.
Unsecured household debt is set to exceed £15,000 before the end of the next Parliament, the analysis also revealed.
The rise in household debt may be attributed to stunted wage growth, and reflects the UK’s ‘ongoing living standards crisis,’ said the TUC. It also found that wages in the UK are currently worth £20 per week less than before the financial crisis.
The business group is urging the next government to act urgently to deliver higher wages for UK workers.
Frances O’Grady, General Secretary of the TUC, said: ‘The surge in household debt is putting the economy in the danger zone.
‘We’ve got this problem because wages haven’t recovered. Credit cards and payday loans are helping to prop up household spending for now, but millions of families are running on empty.’
More than a third of people planning to retire this year are still providing financial assistance to family members, according to research from insurance company Prudential.
Some 34% of retirees expecting to retire in 2017 are paying an average of £260 a month to help out family members, adding to the squeeze on their own retirement incomes.
Of this figure, the study found that the most likely financial dependents are the individual’s own children (45%), while some 24% are supplementing the incomes of their grandchildren and partners.
Despite many people providing financial support to their loved ones, the research revealed that around one in three (34%) of this year’s class of retirees still expect to leave an inheritance – up from 28% in 2016.
The average inheritance is expected to be in the region of £173,000.
Commenting on the findings, a spokesperson for Prudential said: ‘With life expectancy increasing rapidly it is not unreasonable to expect the members of the Class of 2017 to be looking forward to a retirement that will last 20 years.
‘However, for those providing financial support to their dependants it is likely to cost them an average of £62,000 over the course of their retirement – accounting for a significant proportion of their pension pot and impacting the income they can expect to live on,’ she said.
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A new report published by the Resolution Foundation has suggested that workers in the UK are receiving ‘lower rates of pay’ as a result of higher pension deficit payments.
The report revealed that workers are unfairly losing an average of £200 a year, and that low paid and younger employees are the most affected by the loss – many of whom are not entitled to the pension pots they are plugging.
Older workers and those already in retirement ‘stand to gain the most from the plugging of gaps’, the Foundation stated in its report.
The think tank revealed that UK businesses spent around £24 billion trying to reduce their pension deficits in 2016.
Matt Whittaker, Chief Economist at the Resolution Foundation, said: ‘Our research shows for the first time that there is indeed a link between rising pension deficit payments since the turn of the century and reduced pay.
‘With average earnings still £16 a week below their pre-crisis peak and prospects for a return to strong pay growth looking shaky, it’s important that younger and low paid workers don’t take a hit to their pay because of deficit payments to pension schemes that they’re not even entitled to.’
The Small Business Taskforce has outlined its priorities for UK small firms ahead of the General Election on 8 June.
The Taskforce, which is comprised of 14 organisations, including the Institute of Chartered Accountants in England and Wales (ICAEW), Enterprise Nation and the Entrepreneurs Network, has set out six key recommendations in its election manifesto, which it believes will help ‘build a positive and progressive business case for Britain’.
Amongst these key recommendations is a requirement for the next government to provide an environment which ‘champions the role of small businesses’, create a tax system that supports businesses of all sizes and supply business support that adds value.
The manifesto also calls for the next government to provide an advantageous pensions and benefits system, supply procurement opportunities that are beneficial to all and create a workforce that is equipped for enterprise.
Clive Lewis, Head of Enterprise at the ICAEW, commented: ‘Whatever the outcome on 8 June, the incoming government must provide a solid platform for small businesses to flourish and grow.
‘Currently businesses are cautious about the future and are holding back on investment, therefore it’s vital that, in the run-up to the General Election, all political parties spell out how they plan to encourage businesses to invest in long-term growth.’