Truthfully? Not much nowadays. I’m 34 and pay my National Insurance contributions both as an employed and a self employed person, but by the time I hit retirement age (which will probably have been raised to something like eighty by then anyway) the chances of there being a traditional state pension will be slim indeed.
And what of personal pensions? The moral here is to start young. The older you are, the more you’ll have to put away every month to even stand a chance of getting a half decent pension by the time you’ll need it.
So what are we to do? I think people are realising that traditional pensions just don’t cut the mustard anymore. Small wonder people my age are sceptical of having one. Many people are now investing in property to provide them with a nest egg to sell or rent out when they retire. Others are looking to build their own business to keep them comfortable in years to come.
It used to be that you would leave education, get a job and stay in that job for life, retiring decades later with a nice pension which you could enjoy before finally popping your clogs at the end of it all.
Now things are very different. The world has changed. People know there’s no such thing as a job for life anymore, much less a decent pension at the end of it. It’s forced people to become more pro-active in how they live their lives, and although this has produced some foolhardy risk takers, who live life for the moment with little thought of the future, it’s also produced people who have changed their lives for the better.
There’s no reason to suppose getting a pension is 100% a bad thing. But it’s wise to keep your eyes open and be pro-active in deciding how you will be able to provide for yourself when the time comes to retire. Don’t expect the government to do it for you, and don’t expect a pension to solve all your monetary problems.
And however old you are, the time to start thinking about retirement (and how to fund it) is now.