PENSION troubles are looming for Guernsey people.

Close Private Bank business development manager Robbie Moore said recent UK media coverage highlighting potential problems there would also be applicable here. ‘It seems that virtually every day national newspapers are warning that people will either have to work until they are older or have a major change in lifestyle when they retire,’ he said.

‘It concerns me that many people in Guernsey read the stories but think that it is not a Guernsey problem.’

Mr Moore said the shift from defined-benefit schemes to defined-contribution ones, coupled with a longer-living population and a desire to lead more extravagant lifestyles, was having an impact.

BWCI Group partner Diana Simon agreed that mortality-rates were increasing in the island, which reflected the increases that have been recorded in the UK.

She said the number of defined-benefit schemes in Guernsey was dwindling, with many companies no longer offering the scheme or closing one down altogether and transferring employees to a defined-contribution plan.

‘It’s much more of an unknown environment for defined contributions as people are not going to know exactly how much they will have upon retirement,’ she said.

‘You have to be aware that you will have a certain pot at the end of the year. With people living longer, it is definitely an issue going to be faced by islanders.’

The defined-benefit scheme offers the member a pension based on their final salary and number of years’ service and so the amount can be calculated and budgeted for.

In a defined-contribution one, a percentage of a salary is paid into the scheme each year. However, the member cannot calculate in advance the amount to be received on retirement.