Lease for Life calculator
This week brought fresh evidence of just how unscrupulous the Government is - and how difficult it is for people who sincerely want to do the right thing to select the best course of action. There was bad news about the State Second Pension (S2P), which is probably still better-known as the State Earnings Related Pension Scheme or Serps.
S2P is nothing more than a glorified Ponzi scheme or pyramid scam, where this week's National Insurance Contributions paid by employees and employers are used to pay next week's benefits to pensioners. Half a century ago, no less an authority than Aneurin Bevan - one of the founders of the welfare state - let the cat out of the bag when he said: "The great secret about the National Insurance fund is that there ain't no fund."
The reason that such an approach to providing pensions is illegal in the private sector is that it is inherently unstable. What happens, for example, if the number of contributors falls and the number of claimants rises? You don't need to be an actuary to see that the pay-as-you-go merry-go-round must grind to a juddering halt.
Nor is there anything hypothetical about that risk; it is already happening.
John Hutton, the Work and Pensions Secretary, said this week that for the first time in Britain's history there are now more pensioners than children. Nobody should be surprised by the ageing population - back in the 1990s the "demographic time bomb" phrase became so over-used that it was banned at this newspaper - but the politicians' solution to the problem is so breathtakingly hypocritical it deserves a prize for shamelessness.
Mr Hutton breezily announced this week that people aged 40 or younger should forget hopes of early retirement in their 50s and think instead of doing so in their 60s or 70s. Never mind that Mr Hutton has preserved the right for public sector workers to retire as early as 48 and that those in local government can go at 55 - or that 39pc of them actually go even earlier than this, due to ill-health.
No, the worst thing about Mr Hutton's statement is that it skates over the awful truth that many of today's youngsters may never be able to retire at all. With graduates beginning their working lives encumbered by bigger credit card debts than their parents ran up in a lifetime and property prices soaring out of reach, younger people can hardly be expected to start saving toward retirement until well into middle age. Meanwhile, to prevent the precarious state pension falling off the wire before the current crop of politicians have safely retired to spend more time with our money, state pension ages are being raised. Instead of 60 for women and 65 for men, as now, these will be equalised and rise to 66 between 2024 and 2026; 67 between 2034 and 2036; and 68 between 2044 and 2046.
Without wishing to seem morbid on a Saturday morning, it is an actuarial fact that one in five men never lives to celebrate his 67th birthday and that nearly a million people working today will die before they reach the new retirement ages. Lest this seem like a counsel of despair, I had better emphasise right now that the moral of this story is you cannot rely on anyone else to fund your retirement for you.
The golden age of politicians with principles you could trust and paternalistic employers funding final salary pensions is drawing to a close.
From now on, when it comes to saving for old age, our motto should be: "Do it yourself." Which is why I am happy to remain opted out of S2P and instead receive about £1,900 a year in National Insurance Contributions which are invested in a personal pension.
Equitable Life - subject of another damning report on the Government's negligence by the European Parliament this week - reminds us how important it is to choose the right home for private sector savings.
Even so - and despite the latest batch of figures, showing that the Government is swindling opt-outs like me by underpaying National Insurance Contribution rebates by between £1 billion and £2 billion a year less than actuaries recommend - I would much rather be out of S2P than in.
What it boils down to is a choice between an ill-defined share in an unfunded scheme and a pot of private property.
Choosing to trust Messrs Brown and Hutton - or, more precisely, their unknown successors in the future when you come to present your claim for payment - would seem to me to be a triumph of hope over experience. Here and now, the S2P opt-outs - or protected rights personal pensions as they are known in the jargon - can also be used to pay tax-free withdrawals equal to a quarter of the fund when you reach 50 years of age.