Increase to Minimum Pension age from 55 to 57 on 6th April 2028

Sea_Shell

LHW99 said:

I would hope if this goes ahead that the ability to add to a SIPP / DC and get tax relief would also increase from 75 to 78 ie 10 years after SPA.

That would be sensible...to move both goalposts.    But I bet they don't!

jsinc

hugheskevi said:

HM Treasury have published a consultation document about increasing the minimum pension age from 55 to 57 in 2028. Key points for me are:

...

• Pensions opened after 11th February 2021 will have a minimum pension age of 57 from 6 April 2028. Protection is on a pension-arrangement basis, not related to the individual, so changing jobs would mean the new pension would have a minimum pension age of 57 from 6 April 2028. However, it presumably would be possible to transfer newly accrued pension into the protected pension arrangement if desired (and if permitted by former scheme) ...

Oh great I just initiated a transfer last month, and yet to complete.

(here's hoping it really is the date the pension opened not the date a transfer completes)

Thanks for the info though

Alexland

First reply from our L&G SIPPs which were just little ones to get the cashback a few months ago - "The change of retirement age to 57 hasn"t been drafted into law at the moment once the government provide more clarity on how they will introduce the new retirement age we will be able to update our literature to explain how this affects our customers. We will also update you as to whether or not you have a protected retirement age of 55."

So they stopped short of confirming we currently had an unconditional right of access at 55 as required by this consultation or providing a copy of the scheme rules as requested as I can't find it on their website.

elouise01582

I was just sorting out a £3,600 gross pension contribution for my mum aged 74 today and agree that if the minimum age increases to age 57 then why can't the maximum increase to age 77 - I too bet it won't - great minds think alike though.

Thrugelmir

Alexland said:

Thrugelmir said:

Clearing the interest only mortgage with the tax free lump sum would require a considerable pot to have been built.  Far more than the average borrower probably even accumulates in their entire working lifetime.

Depends how long they had the property (as the price paid may have diminished in significance with inflation) or if like us it was a repayment mortgage before being switched to interest only so the balance isn't much.

When Northern Rock collapsed in 2008. Average outstanding interest only mortgage balance was around £165k. That would amount to pension pots of £660k. Far above the norm. Which is the danger when talking about what one is doing personally. 

Alexland

Thrugelmir said:

When Northern Rock collapsed in 2008. Average outstanding interest only mortgage balance was around £165k. That would amount to pension pots of £660k. Far above the norm. Which is the danger when talking about what one is doing personally. 

But what was the average value for those customers nearing the point of retirement where they might want to use their TFLS to clear the balance? Probably significantly lower.

veryintrigued

Many thanks for the OP for this thread and the contributions so far.

As someone with a number of prospective company pensions (both DB and DC) which currently allow access at 55 and thankfully reaching the 55 just prior to the, currently proposed, cliff edge date I'm book marking this thread to see progress.

For anyone interested below is a thread which I started years ago on this very subject.

https://forums.moneysavingexpert.com/discussion/5902379/private-pension-increase-from-55-in-2028#latest

Thrugelmir

Alexland said:

Thrugelmir said:

When Northern Rock collapsed in 2008. Average outstanding interest only mortgage balance was around £165k. That would amount to pension pots of £660k. Far above the norm. Which is the danger when talking about what one is doing personally. 

But what was the average value for those customers nearing the point of retirement where they might want to use their TFLS to clear the balance? Probably significantly lower.

Northern Rock only listed on the stock market in 1997 and commenced to leverage it's balance sheet there after.  Short and sweet existence with a business model that proved unsustainable. 

Mick70

the rise in pension age to 57 has been well documented over past year or so , most will be aware of it .
I just hope as a knee jerk reaction to covid the treasury dont feel the need to raise it further and indeed to raise the state pension age past 67 

Alexland

Mick70 said:

the rise in pension age to 57 has been well documented over past year or so

Well it hasn't - and that's the interesting thing about this consultation that we are starting to get details behind the ambition and for some of us it's looking much better than expected and we might still be able to access our pensions at 55.