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

Sea_Shell

This seems to be referring to pension "schemes", with specified dates of when pensions can be taken.  eg my DH had a final salary pension which states it can only be taken from 65.    If you had one that specified 55, that would be protected?

Does this apply to SIPPS and Personal Pensions?

zagfles

jamesd said:

zagfles said:

Seems to be no mention of those who turn 55 in the couple of years before 2028. For instance, someone who turns 55 in Jan 2028. Do they have 3 months in which they can take their pension, up to Apr 2028, but if they don't they have to wait till Jan 2030 when they're 57? What if they've crystallised, can they carry on drawdown?

If the pension was opened on or after 11 Feb 2021 its access age is 57 and they can't touch it when they are only 55. If opened earlier they can because its age is 55. Before or after April 2028 doesn't change the answer, that change happened on 11 Feb 2021.

The consultation document clearly states in several places that the rise in the NMPA from 55 to 57 will happen in 2028.

Croeso69

zagfles said:

jamesd said:

zagfles said:

Seems to be no mention of those who turn 55 in the couple of years before 2028. For instance, someone who turns 55 in Jan 2028. Do they have 3 months in which they can take their pension, up to Apr 2028, but if they don't they have to wait till Jan 2030 when they're 57? What if they've crystallised, can they carry on drawdown?

If the pension was opened on or after 11 Feb 2021 its access age is 57 and they can't touch it when they are only 55. If opened earlier they can because its age is 55. Before or after April 2028 doesn't change the answer, that change happened on 11 Feb 2021.

The consultation document clearly states in several places that the rise in the NMPA from 55 to 57 will happen in 2028.

Quite, otherwise the increase to 57 happened on 11 Feb 2021, so there would be no need to refer to 2028 at all. I am surprised that @jamesd has misinterpreted this.

noitsnotme

Sea_Shell said:

This seems to be referring to pension "schemes", with specified dates of when pensions can be taken.  eg my DH had a final salary pension which states it can only be taken from 65.    If you had one that specified 55, that would be protected?

Does this apply to SIPPS and Personal Pensions?

You seem to be missing the point.  When are you 55?  If you are 55 this year as you hinted then this change won’t affect you as you will be 55 long before 2028 when the change actually comes in to force.

Sea_Shell

noitsnotme said:

Sea_Shell said:

This seems to be referring to pension "schemes", with specified dates of when pensions can be taken.  eg my DH had a final salary pension which states it can only be taken from 65.    If you had one that specified 55, that would be protected?

Does this apply to SIPPS and Personal Pensions?

You seem to be missing the point.  When are you 55?  If you are 55 this year as you hinted then this change won’t affect you as you will be 55 long before 2028 when the change actually comes in to force.

My DH is 55 this year, I'm 55 in 2026.

It was the talk of NEW pensions not being accessable at 55, even if this was before 2028.

If either of us open a new pension, with a new provider, to enable drawdown, can we both still access at 55 if this is before 2028?!

ratechaser

OK perhaps I'm a more relevant example. I am 55 on the 7th April 2028. Nice.

I have 4 pensions

- one with Vanguard started in March 2020
- one with Nutmeg started in December 2020 (although one of the 2 pensions that I was transferring in did not fully move until the 13th February)
- one active DC scheme with my employer through Wills Towers Watson, started in 2018
- one deferred DB scheme with an old/defunct employer, now held with Rothesay

Right now I have no idea if I will have preserved rights to access any of these at 55 or if they will all only be accessible at 57. It's not the end of the world, but it would have been nice to have a bit more flexibility. I have asked Nutmeg what their position is re the consultation but not heard back yet...

jamesd

hugheskevi said:

jamesd said:

zagfles said:

Seems to be no mention of those who turn 55 in the couple of years before 2028. For instance, someone who turns 55 in Jan 2028. Do they have 3 months in which they can take their pension, up to Apr 2028, but if they don't they have to wait till Jan 2030 when they're 57? What if they've crystallised, can they carry on drawdown?

If the pension was opened on or after 11 Feb 2021 its access age is 57 and they can't touch it when they are only 55. If opened earlier they can because its age is 55. Before or after April 2028 doesn't change the answer, that change happened on 11 Feb 2021.

My reading of the consultation is that for pensions opened after 11 February 2021 the minimum pension age is 55 until 5 April 2028, at which point it increases to age 57 overnight (noting that individual pensions will be free to increase minimum pension age earlier if they wish). Paragraph 2.12 says:

I agree and edited accordingly.

jamesd

hugheskevi said:

In addition to this, some schemes operate a system of internal transfers on decumulation for their legacy products to provide access to the pension flexibilities. From the member perspective not a great deal changes, but it will be interesting to see how such arrangements are affected by the transfer rules.

Those are technically different "arrangements" within the same "scheme" so as long as the rules refer to just schemes it should be OK.

Arrangements seem to come up most here with respect to HL facilitating small pot access from a bigger pot. The small pot rules specify that they are per-arrangement, not per-scheme. So HL cane cut out a chunk to more conveniently do it.

jamesd

Sea_Shell said:
My DH is 55 this year, I'm 55 in 2026.

It was the talk of NEW pensions not being accessable at 55, even if this was before 2028.

If either of us open a new pension, with a new provider, to enable drawdown, can we both still access at 55 if this is before 2028?!

Your DH isn't affected but you might be. He can do what he likes with new pensions because he's already 57 when 6 April 2028 shows up.

In any scheme with a protected age you're also certain not to be affected. You're also certain not to be affected if your 57th birthday is no later than 6 April 2028.

If a scheme isn't protected (new or otherwise excluded) then you can access the pension from your 55th birthday until 5 April 2028, then need to wait until your 57th birthday for any parts you haven't touched. 

jamesd

ratechaser said:

OK perhaps I'm a more relevant example. I am 55 on the 7th April 2028. 

You could be 55 on 5 April 2028 and have to have everything unprotected done on that exact day or wait two years. At least it's Wednesday, not a Sunday.