7/1/2009 - Happy 100th Birthday, State Pension

The State Pension celebrated its 100th birthday in 2008

In 1908, under the Old Age Pensions Act introduced by David Lloyd-George, the new State Pension paid 5 shillings a week to men and women aged over 70 - approximately 20% of average earnings at that time. In 2008, the State Pension celebrated its 100th birthday. It is likely that the State Pension will factor somehow in your retirement plans, whether you are relying on it as the basis for your retirement or are treating it as a potential bonus, dependent on future Government policy.

John Davies, head of business law at the Association of Chartered Certified Accountants, said: "The State Pension has been the cornerstone of the UK's system of social security for a century and has contributed hugely to the achievement of a decent quality of life by those of retirement age. Nonetheless, people today are, on average, spending much more time in retirement than was the case in 1908. Because of this, the cost to the State of improvements in longevity inevitably increases. The UK Government has needed to adapt to these changing circumstances - just recently we have seen plans approved to raise the State Pension Age from 65 to 68. But such is its significance that the State Pension is likely to survive, in one form or another, for many years to come."

The State Pension is no longer simply a cheque that you pick up when you reach a certain age. There are options around when you can take the benefits that can offer some good marginal benefits to your personal financial plans. You can find more information about the State Pension and the recent reforms by visiting www.thepensionsadvisoryservice.gov.uk.