The 75-Gate Pension Model
Private savings bridge you to 75; a sustainable state pension carries you for life.
McPhail's most radical proposal reframes retirement income as a two-phase sequenced system rather than a single-pot problem. In Phase 1, private pension savings fund retirement from whenever the individual chooses to stop working (say, 65) until a fixed gate age of 75. In Phase 2, a materially reformed and more generous state pension kicks in at 75 and covers the rest of life. This sequencing transforms two intractable problems into one solvable system.
The first problem it solves is state pension sustainability. The triple lock and demographic aging are making the current state pension fiscally unworkable. By shifting the state pension age to 75 (gradually, over ~50 years), the cost per recipient rises dramatically — McPhail notes that each recipient would collect roughly £125,000 over a current-age retirement versus £20,000 starting at 75. A later, more generous-per-year state pension becomes affordable in aggregate even as it becomes more valuable per recipient.
The second problem it solves is the decumulation puzzle: how to structure private savings when you don't know how long you will live or what investment returns you will get. If you know private savings only need to last 10 years (from your chosen retirement age to 75), the planning problem collapses. A £200,000 pot divided over 10 years is a straightforward drawdown calculation — no annuity required, no sequence-of-returns anxiety about running out at 95. The state pension absorbs longevity risk from 75 onward.
- Private savings and the state pension should be designed as a sequence, not independent parallel systems.
- The state pension's original purpose was longevity insurance for those who outlived their resources — not a universal entitlement from the mid-60s.
- A known finite drawdown period (private savings to age 75) transforms the decumulation puzzle from an unsolvable longevity gamble to a straightforward calculation.
- The state pension becomes affordable when it starts later and is set at a genuinely adequate level per year, rather than starting early and eroding to inadequacy.
- Any major state pension age change requires at minimum 10 years' notice — the reform must be phased over decades, not announced abruptly.
- Establish your target private savings bridge amountCalculate how much annual income you want from your chosen retirement age to 75. Multiply by the number of years in that bridge (e.g., retire at 65: 10 years). In today's money, McPhail suggests £20,000/year is a reasonable bridge figure, implying a £200,000 pot minimum. This is a defined-end drawdown — no annuity required.Pro tipThis calculation works because you are solving a finite problem. A £200,000 pot distributed over 10 years at £20,000/year leaves nothing at 75 — which is correct, because the state pension takes over.WarningThis model requires the state pension at 75 to be set at a genuinely adequate level — approximately £20,000/year in today's terms. If you are using this as a personal planning framework, you must assess the political risk that the state pension reform does not happen.
- Assess the sustainability of the state pension backstopTrack the trajectory of state pension policy — triple lock debates, state pension age reviews, and pensions commission outputs. The 75-Gate model depends on the state pension being solvent and adequate from 75. If political risk is high, build additional buffer in private savings to extend the bridge beyond 75.WarningMcPhail is explicit that the current trajectory leads to 'managed decline' — a state pension that gradually becomes valueless. The 75-Gate is a proposed fix, not a description of current policy.
- Restructure the triple lock toward earnings-linkageIn the reformed model, the state pension is indexed to average earnings (the IFS recommends 83% of average earnings) rather than the triple lock. This removes the ratchet effect that makes the current system unsustainable. As a personal planner, model your state pension income at the lower earnings-linked level rather than assuming triple-lock continuation.Pro tipThe IFS earnings-linkage target gives you a more conservative and more realistic planning figure than the triple-lock trajectory.
- Separate the retirement age decision from the state pension ageUnder this model, you can retire at any age your private savings support. Retiring at 60 means a 15-year private savings bridge; retiring at 70 means a 5-year bridge. The decision is separable from state pension age. McPhail is explicit that 'no one has to work until they're 75.'WarningAccessing private pensions before the minimum pension access age (currently 57, rising to 58) is not possible — ensure your bridge planning accounts for this access constraint.
McPhail illustrates the model with a worked example: a worker retires at 65 with a £200,000 pension pot. Under the current system, this must last an unknown number of years — triggering decumulation anxiety. Under the 75-Gate, the pot funds exactly 10 years at £20,000/year, drawn to zero. At 75, a state pension of ~£20,000/year kicks in.
The state pension currently costs ~5% of GDP (approximately £130bn/year). Unchanged, this rises to 7.5% of GDP by 2070 — an increase of ~£75bn in today's money — driven purely by demographic aging. The working population paying for it will shrink as the retired population grows.
Average UK male life expectancy is approximately 79 — only 4 years above current pension age 66 under existing rules. Life expectancy in poorer areas such as Blackpool is around 74, meaning a significant proportion of working-class men in these areas already do not reach state pension age, while wealthy Chelsea residents may draw it for 20+ years.
McPhail arrived at this model by looking at both sides of the sustainability problem simultaneously. Working at Hargreaves Lansdown and then The Lang Cat, he repeatedly encountered two separate but connected failures: state pension costs growing unsustainably, and private savers paralysed by longevity uncertainty in decumulation. The insight was that they were the same problem in disguise — the state pension's original purpose was as a longevity insurance backstop for people who outlived their resources, not as a universal 20-year income entitlement from age 66. Reconnecting the state pension to its founding purpose implied a later trigger age, which in turn simplified private pension planning.