Time to get the soap box out. Why do we persist in making pension projections to age 65? As life expectancy increases, these projections produce ever increasing contribution rates, required to provide what is deemed as a reasonable level of income.

It should be self evident that, based on a working life time of 45 years and potential retirement of approaching 25 years (and getting longer by the day), the figures just won't stack up unless massive contributions are paid every year.

In fact, the figures are enough to scare off anyone and as has been said this week by a member of the Think Tank, it should come as no surprise if our current system of provision for retirement falls apart. Hopefully we can replace it with something more fit for purpose.

A system based on life as we know it, with an expectation of retirement on a generous income from age 65 or thereabouts, is just not feasible. It is time to adjust to the fact that people will have to work longer where possible and retirement as late as age 75, or even 80, will become the norm. Working life must become more flexible with sabbaticals, opportunities for alternative career paths, and the like. In the future (and the future begins now), we need to work towards everyone achieving a better work / life balance throughout their whole lifetime and move away from the current see-saw of moving from full time work into potentially impecunious retirement.

We need to move away from making projections to age 65 and perhaps move away from pension projections altogether. Defined contribution schemes are based on an accumulation of contributions and expected proceeds from all that saving ought to be expressed as cash. Savers can then see what they expect to build up at different ages, and if they simply divide the expected pot by the number of years they expect to live from the time when they start to draw their pot, they can get a good idea of the income they might expect to receive from that pot. Not rocket science and not approved as a valid approach by our financial advice overlords, but a good rule of thumb to help people see what pension they might build up if they retired at various ages.

With all the emphasis on encouraging people to save for retirement a simple approach to projection might just conceivably make such savings more attractive.

Written by Chris Atkin, managing director, Atkin & Co