This document discusses challenges facing retirement savings in the UK, including an aging population, falling dependency ratio, and insufficient savings. It notes most people will need to save 15% of income to retire comfortably. Charts show the wide distribution of UK incomes and savings needed at different ages and salaries to achieve a £15k annual retirement income. The document proposes making retirement savings more timely, social, attractive, easy and low cost through initiatives like workplace ISAs and expanding auto-enrollment pensions.

1. Teach-in DC/Age of Responsibility 14 July 2015 1
Big Picture
• Aging
population
• Dependency
ratio falling
• People are not
saving enough

2. Teach-in DC/Age of Responsibility 14 July 2015
Teach in: DC Investment
Strategy in the ‘Age of
Responsibility’
2

3. Teach-in DC/Age of Responsibility 14 July 2015 3

4. Teach-in DC/Age of Responsibility 14 July 2015 4

5. Teach-in DC/Age of Responsibility 14 July 2015 5
“People need to save more”
• A savings culture and system
• Ensure a “living wage” in retirement
• Most people
• By 2035
Save 15%!

6. Teach-in DC/Age of Responsibility 14 July 2015 6
E A S TTimelySocialAttractiveEasy

7. Teach-in DC/Age of Responsibility 14 July 2015

8. Teach-in DC/Age of Responsibility 14 July 2015 8
Who are “most people”?
0
20,000
40,000
60,000
80,000
100,000
120,000
140,000
160,000
1 3 5 7 9 11 13 15 17 19 21 23 25 27 29 31 33 35 37 39 41 43 45 47 49 51 53 55 57 59 61 63 65 67 69 71 73 75 77 79 81 83 85 87 89 91 93 95 97 99
Distribution of UK Incomes (Tax Payers Only)

9. Teach-in DC/Age of Responsibility 14 July 2015 9
What is a “living wage” in retirement?
£15k a year
Requires a pension “pot” of £200k
Contributions Required:
Salary
Age started saving: £20,000 £30,000 £50,000
20 12% 8% 5%
30 17% 12% 7%
40 26% 18% 11%
50 45% 30% 18%
60 112% 75% 45%

10. Teach-in DC/Age of Responsibility 14 July 2015
Auto Enrolled
Pension
ISA
State Pension
Home Ownership
• More Timely => Like “Help to Buy”
• Easier & More Social =>
Workplace ISA
• Easier & More Social => Source of
Retirement Income
• More Attractive => E-E-E
• Less Cost => Annual Allowance £5k
& Flat Tax

11. Teach-in DC/Age of Responsibility 14 July 2015
• More Timely => Like “Help to Buy”
• Easier & More Social =>
Workplace ISA
• Easier & More Social => Source of
Retirement Income
• More Attractive => E-E-E
• Less Cost => Annual Allowance £5k
& Flat Tax