The Impact of an Aging Population on Young People

The House of Lords report suggests that successive governments’ failure to address the financial and societal challenges caused by an aging population will have a significant impact on young people. They will be hit hardest and need to plan and prepare to work longer and save more at a much earlier age.

The Need for Urgent Action

The economic committee emphasized that the crisis in adult social care "remains a scandal" that needs to be urgently addressed. The committee chairman stated that it is a "struggle to work out where in government" there would be a focus on aging and the "transformational impact" it would have on people. He added that "age is something we’re watching right now" and that adaptation is the way forward.

Insufficient Solutions

The measures taken by governments to address the impact of falling birth rates and increasing life expectancy, such as raising the state pension age or increasing immigration, are not sufficient solutions on their own. Encouraging more people in their 50s and 60s to stay or return to their jobs is vital, and the government must prioritize incentives to do so.

The Impact on the Economy

An aging population will require more nursing staff, leaving fewer workers for other parts of the economy. There is "widespread ignorance" about how much it costs to retire, and the government should consider an education campaign to address this issue. The government should also find out whether the UK’s financial services sector is able to care for the aging population.

The Need for Financial Planning

The committee chairman emphasized that the government and the financial services industry need to find more innovative ways to get younger people thinking about their future and planning for it. Young people have a lot of time for financial planning, but they often do less financial planning than they should. Increasing the statutory retirement age is a diversionary tactic that saves the state money but increases poverty among pensioners. To successfully meet this challenge, the approach to financial management of today’s and tomorrow’s young people must change.