Early Retirement Made More Difficult from 2028

10.12.2021
Stephen Cameron
Financial Planning

In November 2018, the UK State Pension age was 65 for men and women. However, this has been gradually increasing and when you receive your State Pension now, depends on when you were born. Therefore, State Pension age for all men and women will reach age 67 by 2028.

You can find out when you will be able to claim your State Pension here: Check your State Pension age.

The State Pension age will continue to be kept under review, which means that it could change again in the future, depending on various factors, such as further changes in life expectancy. 

This has a knock on effect for those who save into private pension schemes.

How Does This Affect Private Pensions?

This has a knock on effect for those who save into private pension schemes such as personal pensions or company pensions unless their scheme has a protected retirement age, such as the Police Force, Fire Service or Armed Services pension schemes, to name a few.

Currently, those who save into Personal Pensions/Workplace Pensions without a ‘protected retirement age’ will see that the age at which they can access their pension savings increase from 55 to 57 from April 2028. This maintains the current 10 year age gap between those who can retire early having saved to provide for themselves in retirement and those who have not/those who have been unable to.

So, anyone who was planning to retire at the age of 55, should check to see if they will be affected by these rule changes and consider what actions they may need to take, to keep their retirement plans on course. 

Whilst saving into pensions is very tax efficient, there are other forms of investment that can be utilised in addition to saving into pensions, which are not affected by these rule changes and very tax efficient also. People who had planned to retire at age 55 but will now be unable to access their pensions for a further two years, may wish to speak to their Financial Adviser to establish what they may be able to do between now and 2028 to build a capital sum, that can be accessed from age 55 to provide their required income, for the additional two years these rule changes create.  

Contact our Financial Planning team today

If you have any questions about this article, or would like advice about your pension, Lovewell Blake's experienced Financial Planning team is ready to help you. 

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