New life time ISAs could herald the long term demise of private pensions
Responding to the BudgetCarolineAbrahams, Charity Director for Age UK, said:
“Knowing you have a secure income to rely on in retirement is very precious, as grandparents often rightly tell their grandchildren, and it will be all the more important for today’s young people because rising longevity means they may well be retired for a long time. The question is how best to support every young person to reach a position where they can look ahead to their later life with confidence, not fear.
"Today the Government has announced the introduction of life time ISAs to help the under-40s to save. We accept that the flexibility of a lifetime ISA may be attractive but this must not come at the cost of a proper pension in later life.
“Some experts are already expressing concern that these new life time ISAs could herald the long term demise of private pensions, because they incentivise young people to invest elsewhere. If this was to happen it would be a tragedy for future generations and that’s why we think it is crucial that the Government also acts to sustain the attractions of pension saving and continues to give policy priority to automatic enrolment into workplace pensions – an excellent initiative that has got off to a good start and that needs strengthening so it can be even more useful in years to come.”
