This is with Hamish McRae, a subscriber-only newsletter from The i Paper. If you’d like to get this direct to your inbox, every single week, you can sign up here.

It looks like a big deal: the ending of the triple lock. And in a way it is: for any government to reject the promise made by a predecessor less than 20 years earlier to try to improve the state pension is a political earthquake. After all, despite the policy being in place since 2011, our basic pension is still among the lowest, relative to incomes, in the developed world.

But actually ending the link with earnings, and just keeping the other two elements – increasing it by the higher of the consumer price index or 2.5 per cent – doesn’t save much money for the government in the short term, and may not happen anyway if Labour is not returned at the next general election.

So it’s best to see this not as a huge financial event, but more as an indication of the financial uncertainties we all face when planning for our futures. This is partly about politics, for if we can’t know what the government might do 20 years ahead, what hope have we of knowing what policies they will have in 50 years’ time, when today’s 30-something-year-olds will be drawing their pensions?

But the are arguably greater than the political ones. There will be some sort of state pension in the 2070s, though maybe not a very good one. But what will happen to inflation? Prices have gone up seven-fold over the past 50 years, for according to the Bank of England’s inflation calculator, to buy now what £10 would get you in 1976 would cost £69.96. House prices have gone up even more, and are now around 25 times higher. But maybe, in real terms at least, they will decline, as seems to be happening at the moment.

What will happen to jobs? In 1976, there were 247,000 coal miners in the UK; now there are 272. That’s an extreme example of an industry collapsing, but the reverse is even more startling. In 1976, there were around 50,000 people employed in computer services; at the end of 2024, it was 1.77 million in what’s called the digital sector. The numbers may not be directly comparable, but you see the point.

Coping with these uncertainties is tough, but we have no choice. There is one obvious implication we should draw from the ending of the triple lock, and one less obvious one.

Obviously, we have to make better private provision for our pensions. You trust yourself, not some future politician who may not even be born now. There are a couple of things here that help.

One is auto-enrolment, whereby everyone at work is in a pension scheme that their employer contributes to, and for which there are tax incentives. It started in 2012, just after the triple lock was introduced and was another achievement of the Tory-Lib Dem coalition government. It’s not perfect. Contributions are probably too low, self-employed people are not properly bound into the system, and there will always be concerns as to whether funds are invested wisely. But it’s a really good base to build on.

The other is compound interest. We know a lot about the performance of various financial assets, shares in companies, government bonds and so on, over the previous 100 years and more. In particular, we know that over a very long period, 40 years and more, that investing in equities – quoted companies on the world’s major stock exchanges – will produce a positive return over inflation. That’s despite two world wars, periodic recessions, the great inflation of the 1970s and the smaller period of inflation now.

And we know that compound interest piles up the value of the pot. Over a long period – and pension planning is a long game – most people should be able to save enough to afford a decent retirement, whatever the state decides to do about public pensions.

More troubling is the less obvious lesson we should draw from all this. Sorting out a private pension is fair enough, but you have to be in some kind of paid employment in your fifties and sixties so that you get to pensionable age without having to run down your savings.

Let’s assume that the state pension age goes up to 70. By the way, when in 1889 the German chancellor Otto von Bismarck brought in the world’s first universal public pension, the retirement age was set at 70. When the UK adopted the German principle in 1908, our pension started at age 70 too.

So how do you go on earning until you are 70? Far too many people find they are made redundant in their fifties and sixties and find it very hard to find another job. At the moment the median age for leaving the workforce is 65.8 for men and 64.7 for women, so already there’s a bit of a gap before the state pension kicks in at 66. There’s the worrying possibility that this will widen – and of course that’s the median, with half the population retiring earlier.

There’s no easy solution to this. Everyone is different and there are some jobs that people in their late sixties won’t want or be able to do. Clearly, though, we have to encourage everyone to think about the latter part of their working life. Should they be prepared to become self-employed? What about a side-hustle that earns some money? Or shifting to a portfolio career?

This is not just about pensions, though that’s a big part of it. It’s about life planning – and that’s an even bigger challenge to get more or less right.

Need to know

I feel two things about all this. One is that we shouldn’t let the perfect become the enemy of the good enough. The other is that for most of us, finding some way of continuing working in some way or other brings huge social benefits that are more important than the rather smaller (or non-existent) financial ones.

On the good-enough point, we all make mistakes, all do things we regret, all get knocked down and have to pick ourselves up. So it is with jobs, so it is with pensions, so it is with life in general. The point here is that for anyone working in the private sector, it’s more important to have some kind of pension early on, to get the benefit of an employer’s contribution, and to get compound interest running, than it is to have the ideal investments or the ideal pension provider. You can fix most things later. The one thing you can’t fix is time if you start saving too late.

So I suggest we shouldn’t beat ourselves up about getting pensions absolutely right any more than we should worry about the ideal house or the ideal job. All we really need to do is to get moving as early as possible – and I am well aware that’s a difficult message to get over.

The other point, about continuing to do something that ideally is paid but not necessarily so, is really important. The adverts in the colour supplements are full of pictures of wealthy, healthy oldies going on cruises or playing golf, and for some that’s doubtless a fine way of trotting through their seventies and beyond. But we all know of people who find it very tough to no longer feel needed, or to no longer have the identity of a job.

I’m also aware of how difficult it is for those who lose their employment and can’t find another post. Some are naturally resilient and find a way through, but for others the loss of status is even more grinding than the squeeze on income.

There’s a lot of work going into this. I saw a comment from Fidelity International on the new ONS figures about how there were around 866,000 people aged 50 to 64 who were not in work but wanted to be. Fidelity did a report introducing the idea of an index measuring how different countries managed the process of working longer lives. They asked these questions and measured the results. Are they in rewarding work? Are they working? Do they want to work? Can they work?

The UK did not do well, coming at the bottom of the G7. Italy came top, just ahead of the US. Now, an index is only an index, but it’s worrying nonetheless. More work is needed and dare I say it, this is a much, much more important challenge than the triple lock.