STEPHEN CRANSTON: A long road to a decent pension, but preservation is more do-able
One has to contribute 17% of their salary for 40 years to get a 75% monthly payout, so keeping money in a pension fund makes better sense
Alexander Forbes has done the widest survey of the health of retirement funds and their members. Its annual Member Watch for the first time included more than 1-million clients belonging to the group’s 2,030 employer clients. As Forbes head of client coverage John Anderson puts it, for many a pension is their only form of long-term savings. But to live comfortably in old age there needs to be a sufficient and consistent level of contributions and an appropriate level of investment return after fees. To make these contributions affordable, there should be steady progress in the member’s salary. Pension funds also need to make deductions for group life and disability cover, in the event of the members not being able to finish their career or support their families. But it is equally important for members to preserve their fund credits, and this has recently been made easier as accumulated capital can now stay in the fund after resignation, and the members can change their status to pa...