You have this nice job at the council, everything is ticking along quite nicely. You are looking forward to a happy and stable retirement and boom.

A problem with most (if not all) of the Government supported pension schemes may end up shocking you when it’s announced that they may not do what you think they are going to do.

Local Government (LGPS) pension scheme is currently underfunded – does not have sufficient investments to cover it’s liabilities [pensions due to be paid at a future date] the present amount it needs is £57bn LGPS Shortfall

The NHS Pension Scheme is also in difficulty with some £500m needing in the coming few years and some £1.2 b needed to be found in the very short term according to the HSJ, worse than the shortfall that’s looming is the longer term and very painful problem of the £500bn shortfall that’s expected.

Teachers Scheme don’t think for one minute you’re safe if you teach. In 2012 the Governments’s own actuary was talking about the scheme needing £15b to ensure all benefits could be paid.

With just these three schemes alone someone needs to find some £572b in the coming years if benefits are not going to be reduced.

The public no longer has access to the same gilt edged pensions – called that because they seemingly are not able to fail and provide guaranteed benefits at retirement [Final Salary Pensions]; it is unlikely that the public will want to pick up the tab for this shortfall via increased taxation.

The Government has a couple of options.

Take the shortfall from the public purse.
Reduce Benefits for existing and new members.
Reduce benefits/increase contributions for future members.

There are a couple of problems with these Government sponsored schemes that will not go away. It’s also clear that these existing pensioners or those shortly to retire will have really had it all, “there is no money left’ as one of the Brown Government Civil Servants stated on leaving his desk.

So it looks like, those under 30 currently members of these schemes will be facing the problem head on, longer working life, reduced pensions and state support, increased cost of housing, increased levels of taxation to pay for an ageing population. And very soon having to stump up more hard earned to cover the mistakes and promises of the past.

Listen now millennials, if you don’t start taking this very seriously and stop relying on the State Pension Promise you are going to be in for a surprise. Pensions as you and I understand them are fatally flawed. Government promises are unlikely to be fulfilled.

If you don’t think you need to make your own plan b, then you are mistaken. Genuinely taking control of your own future financial security has never been more important.

You can find out more about your options by getting the 30 Day Money Course. There is no charge for it, and you will find it helps with your bigger picture planning, it also tells you the truth.