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Are you prepared? Pension access age to be increased?

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A degree of uncertainty has been resolved now that the government has formally announced that legislation will be introduced to raise the minimum pension access age from the current 55 to 57 with effect from 2028, reported the FT Adviser recently.

Raising the effective minimum pension age is in line with the steadily increasing State Pension age and the government’s intention of raising the pension access age has been on the cards since 2014. Little more had been heard of those intentions since 2014, so many wondered whether the change would, indeed, go ahead. The recent announcement confirms that it will.

Timely

The announcement is being made in good time since those extra two years might make a world of difference to those who are approaching a planned retirement and were hoping to access their pension funds when they reached the age of 55. If that occurs sometime in 2028, they have now been put on notice that they must wait a further two years until they are 57.

The government indicated that raising the pension access age reflects prevailing trends in longevity and the move has been made to encourage people to stay in work longer while also helping to make sure that pension savings are adequate for later retirement.

This month, the State Pension age rises to 66 for both men and women. The government intends to raise State Pension age once again, to 67, for both men and women, between 2026 and 2028. You can check your State Pension age using the government State Pension age calculator here.

Next steps

With changes to the ages you can access a defined contribution pension and the State Pension scheme, it is essential you review your current pension arrangements - and projected retirement date – to ensure you are still on track.

This data is correct as at the time of writing.

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