The state pension age is set to increase over time to delay the retirements of countless working people.
In response to growing economic pressures, it is believed that the Government is considering implementing the increase sooner than previously planned.
While such plans have been dismissed by the Treasury, similar rebukes were made regarding the 22 per cent charge on interest in certain ISA accounts shortly before the policy was announced.
As such, it is worth understanding how a delayed retirement could affect you.
When will I get to retire?
The state pension age is currently increasing from 66 to 67 and this change will be completed by April 2028.
There are plans to increase it to 68 between April 2044 and April 2046.
It has now been suggested that this increase will happen seven years earlier, meaning the state pension age will be 68 by 2037.
Declining birth rates and a reduction in net migration mean that the UK’s ageing population will continue to struggle to be supported by the working population for the foreseeable future.
As state pensions are paid from the taxes of current workers and are still subject to the triple lock, it is believed that as much as £6 billion a year must be found for every year the state pension age increase is delayed.
How will this impact my retirement plans?
These changes only affect the state pension, meaning that any private pension you have accumulated may still be accessible at an earlier point in your life.
Retirement planning may be increasingly important for those who wish to conclude their working lives and have enough time left to enjoy their savings.
Alongside your workplace pensions, being strategic with investments and savings can pave the way for a more substantial retirement that is able to fund all of the things on your bucket list.
The state pension age will likely continue to rise, so it might begin to be viewed as a supplementary income for a second stage of your retirement.
Alternatively, many retirees may wish to work part-time or find a more fulfilling job to make up the difference in funds the state pension would usually fill.
Our team can support you in finding the right savings strategy and retirement plan that meets your individual needs.
Get in touch to make sure your retirement is the peaceful experience you deserve.
