The state pension and saving for the future

POSTED: 14th January 2013
IN: Personal News

Preparing for the future is paramount for anyone hoping to enjoy a comfortable retirement and planning sooner rather than later will help ensure all the right provision is in place.

undefinedLooking ahead to retirement, many Britons will be considering the state pension and how it will benefit them in old age.

The government is expected to reveal today (January 14th) that a flat-rate state pension will be introduced from 2017, with means-testing set to be scrapped.

Currently, the state pension pays out a weekly £107.45 but can be increased with pension credit to a total of £142.70.

Under the reforms, however, the state pension will total £160 per week, with the move set to help women and lower earners receive enough funds in retirement.

In an interview with ITV, prime minister David Cameron explained the reasoning behind the changes, which include an additional five years in work.

He said: "I think it's fair to ask people to work a bit longer because we're living longer. So the idea that you should spend about a third of your adult life in retirement seems to me a reasonable one."

For many Britons, the state pension will not be enough to see them through old age, especially considering the cost of care.

That is why now is the time to begin saving, with fixed rate cash ISAs an excellent way to protect funds from tax and interest rate fluctuations.

Having a substantial pot in place can help with raising a deposit for a property, which will provide some security in later life, or help to ensure you have enough funds in place for retirement.

And even if you are not thinking about retirement just yet, practising good saving habits and investing in a pot will at the very least provide security in the event of unforeseen expenses.

The fixed rate cash ISA from Aldermore is flexible, and while it is subject to interest deductions in instances of early withdrawals, it helps with planning ahead and setting out savings for a brighter future.

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