People need more certainty over when they will receive state pension – experts
A review into whether the rules around the state pension age remain appropriate will be published early this year.
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Your support makes all the difference.The retirement age could rise to 68 by the end of the 2030s, reports suggest.
The Department for Work and Pensions (DWP) said that no decision has been taken on changes to the state pension age.
A review into whether the rules around the state pension age remain appropriate will be published early this year.
The Sun reported that people born in the 1970s and later may be told they must work for longer as early as the March Budget.
Pension experts said the Government faces a “tricky balancing act” in supporting an ageing population.
We need to have a proper thorough review of state pension to give people more certainty over how and when it is paid so they can plan ahead
Helen Morrissey, senior pensions and retirement analyst at Hargreaves Lansdown said: “The Government faces a tricky balancing act with the state pension – we have fewer working age people supporting an increasing ageing population and costs are enormous.
“However, we also have to face the very real prospect that many people simply are not well enough to work until age 68.
“Added to this, rapid increases in state pension age have disrupted people’s financial planning.
“With the debate around the triple lock continuing to rage we need to have a proper thorough review of state pension to give people more certainty over how and when it is paid so they can plan ahead.”
The Government recently confirmed that the triple lock will be used to uprate the state pension next year.
The triple lock guarantees that state pensions increase by September’s inflation figure, wages or 2.5%, whichever is higher.
The guarantee means that retirees are heading for a 10.1% increase to the state pension from next April.
A phased increase in state pension age from 66 to 67 by 2028, and eventually 68, are already planned, but there has been speculation that the increase to 68 could be brought forward.
No decision has been taken on changes to the state pension age
Phil Brown, director of policy at People’s Partnership, provider of the People’s Pension, said: “Any changes to the state pension serve as a reminder of the importance of automatic enrolment – now a vital pillar of retirement saving in this country.
“The fact that nearly 11 million people more have started saving for retirement since its introduction in 2012 underlines how much ordinary workers value pensions, so we must ensure it fulfils its potential and provides an adequate retirement for workers across the UK.”
A Department for Work and Pensions (DWP) spokesperson said: “No decision has been taken on changes to the state pension age.
“The Government is required by law to regularly review the state pension age and the second State Pension Age Review is currently considering, based on a wide range of evidence including latest life expectancy data and two independent reports, whether the rules around state pension age remain appropriate.
“The review will be published early this year.”
At Age UK we feel strongly that there is no justification for raising the state pension age at the moment
Jon Greer, head of retirement policy at wealth manager Quilter, said: “Proposed state pension age increases are always a bitter pill for the electorate to swallow as people see their working lives stretch further in front of them.
“However, the Government did signal in its 2017 review that it would follow a recommendation to accelerate the increase to 68 into the 2030s, so these rumours are arguably not a change in stance.”
He added: “Ultimately, people need to take responsibility for their own retirement and plan ahead, and taking professional advice or financial guidance earlier in life is a sensible step.”
Caroline Abrahams, charity director at Age UK, said: “At Age UK we feel strongly that there is no justification for raising the state pension age at the moment, especially as we know that the people who will lose out the most are those unable to work due to ill health and caring responsibilities, as well as anyone who becomes unemployed in mid-life and then finds it impossible to get another job, due in part to a lack of training opportunities as well as rampant ageism in the labour market.
“As things stand, any decision by the Government to make today’s 50-somethings wait longer for their state pension will consign hundreds of thousands of people to a difficult and impoverished later life.”