What hasn’t been communicated to many younger people (I am afraid this means almost everyone under state pension age) is that we are being paid more in our salaries or the amount we draw from our work (Self employed) and deferring payment to later life.

For higher earners, the Oxford/Hargreaves barometer recommends that payments out of a pension cover 50 per cent of pre-retirement earnings to maintain living standards, known as the target replacement rate.

Helen Morrissey of Hargreaves Lansdown suggests that Government should incentivise high-earners to save more. I am not sure. Might not the reason that higher earnings are common for all ages is because pension contributions from employers have decreased with the march to defined contribution workplace pensions?

I have not seen it recognised anywhere but I think it is very possible that people are simply not managing their affairs positively for the future. Are they sacrificing large parts of their income into their workplace pension or paying money from their bank accounts to personal arrangements? I suspect that Oxford and Hargreaves are finding that the amount of money emerging from retirement saving (using the formulation below the chart above) is collapsing as we come to the end of the period where those in the private sector are getting DB pensions and (dare I say it) where compensatory DC payments were paid to those switching from DB to DC.

Benefit Jack is American, there the emphasis is on self-reliance. 401K contribution rates from employers are typically about what we get as mandatory AE mandatory contributions. People have to earn more or retire more and as Benefit Jack points out, that may mean earning longer into the retirement space.

I don’t want to be callous, but many people I know are expecting to retire on 50% or more of earnings of more than £87,200 and are simply not going to make it. Hargreaves Lansdown reckon it’s around of 65% of the financially well off – in terms of earnings.

There is an immaturity about our thinking of the cost of retirement which is staggering. I do not think that many people consider the question of deferred pay but rely on the fact that they are in a pension plan. They are not in a pension plan, they are in a pension saving plan and what they are going to see if they look at their statement SMPI or more dramatically the Pension Dashboard ERI is that they are nowhere near getting to 50% of their earnings as deferred pay.

There is a huge amount of advertising on TV focussing on sums like £250,000 being “wealth”. Using the 4% rule of Hargreaves and University Lansdown, that’s a pension of £10,000 pa, add that to £12,500 from the state and you are on £22,500 which is around the “poorest” earning level examined.

Hargreaves reckoned that we rich urn’s should be given more incentives to save more. I think that very unlikely in today’s climate of fiscal brutality. What I think rich earners need to hear is that they are not taking their retirement seriously.