Personal Finance

Imported item 241

A monthly lottery draw for £1 million should be held as an incentive for people to save for retirement, a report has suggested.

Anyone who contributes to a pension scheme would be eligible to win the draw, which was proposed by the director general of Saga Ros Altmann, who said the idea could even save the Government money as a result of not having to fund an expensive advertising and marketing campaign.

It was also suggested that the term "pension" should no longer be used and should instead be replaced by retirement savings because the word has negative connotations attached to it and it should only be used for the money paid out to older people by the state.

The report found that the UK is facing a pensions crisis as a result of the baby boomer generation, who are now reaching pensionable age, not planning well enough for their retirement.

The average pension fund is only £30,000 to cover the whole of retirement, but one in three women and one in five men will need to go into a care home for an average of two years, costing well over £50,000, she said.

The report called for people to be prepared to work longer and for measures to be introduced to encourage them to save more - including a pensions lottery.

Sam Jackson

Money Dashboard

Subscribe for updates

Get the latest posts delivered right to your inbox

Success! Keep a look out in your inbox!
Oops! Something went wrong while submitting the form.