Access to pension at 55 - mitigating against govt min age changes

Wonka_2

I'm just about to finalise a settlement agreement which will cover me financially until 55 (Sept '25) when I can draw my employers pension if needed at that stage (a pot c.£1m giving me £250k tax free option)

Given the talked about changes to min age is there any way of protecting myself against this (other than continuing to work) or should I stop listening to media stories/scaremongering ?

Brie

The prediction is that the age won't be raised to 57 until 2028 and you'll be 57 before then in any case.  I doubt given the other hassles with changes to state pension age (particularly for women) that this is likely to be brought forward but I'm guessing.  

I'm assuming this is a DC pension?  Or are you a lucky person with a DB?  Either way you may find that you are able to take your pension and continue to work, perhaps paying in to a more recent scheme with your employer.  Just a thought and something you might want to consider.  Obviously it may depend too on what tax bracket you are in.

hugheskevi

Wonka_2 said:

I'm just about to finalise a settlement agreement which will cover me financially until 55 (Sept '25) when I can draw my employers pension if needed at that stage (a pot c.£1m giving me £250k tax free option)

Given the talked about changes to min age is there any way of protecting myself against this (other than continuing to work) or should I stop listening to media stories/scaremongering ?

There isn't much talk of minimum pension age changing at the moment, it is only a few years since the increase to age 57 was enacted for change in April 2028 and I think the potential for any adverse change prior to that is close to zero.

Think tanks are, as they usually do, coming up with various policy proposals/analysis, etc, but neither of the main parties have any significant private pension policies, other than Labour still seemingly flirting with reintroducing Lifetime Allowance but not coming out with a statement to definitively rule it in or out (Labour also have quite a few ideas on the funding side of pensions, but they would not directly affect individuals).

In the timeframes you are talking about, there would be extremely minimal probability of change.

If change occurs, the most likely would be a State Pension age review due by 2026 deciding to bring forward the increase to age 68, and also bring forward an increase to minimum pension age to 58 to maintain the 10 year differential. When that would be introduced would be guesswork - the increase to State Pension age to 68 was suggested to be brought forward to 2041-43, so perhaps the increase to 58 could be 2031-33. I think those are the more plausible sort of timetables which could be expected based on existing policy.

Marcon

Wonka_2 said:

I'm just about to finalise a settlement agreement which will cover me financially until 55 (Sept '25) when I can draw my employers pension if needed at that stage (a pot c.£1m giving me £250k tax free option)

Given the talked about changes to min age is there any way of protecting myself against this (other than continuing to work) or should I stop listening to media stories/scaremongering ?

Yes. This particular one is nonsense given the timeframe.

dunstonh

Given the talked about changes to min age is there any way of protecting myself against this (other than continuing to work) or should I stop listening to media stories/scaremongering ?

What changes are you referring to?

I assume these are not the change to 57 from 2028 as that was announced a decade ago.  Is there something else you are reading as there seems to be nothing with the timescales you are referring to.   So, knowing what you are reading to give you concerns would help.

Wonka_2

Brie said:

I'm assuming this is a DC pension?  Or are you a lucky person with a DB?  Either way you may find that you are able to take your pension and continue to work, perhaps paying in to a more recent scheme with your employer.  Just a thought and something you might want to consider.  Obviously it may depend too on what tax bracket you are in.

Yes I'm lucky that 23 of my 34yrs of contributions are in a DB scheme 

I've already organised a scheme for future contributions should I continue to work (elsewhere) after a break

Wonka_2

dunstonh said:

Given the talked about changes to min age is there any way of protecting myself against this (other than continuing to work) or should I stop listening to media stories/scaremongering ?

What changes are you referring to?

I assume these are not the change to 57 from 2028 as that was announced a decade ago.  Is there something else you are reading as there seems to be nothing with the timescales you are referring to.   So, knowing what you are reading to give you concerns would help.

I think in 30mins I've been reassured by the honorable/knowledgeable members here that any rabbitholes I'd dropped down are complete tosh

I've been abroad this week and on Expat forums and probably a mix of this and verbal scaremongering from those jealous of my position gave me a bit of a wobble   

Logan72

Why is there not a tapered/staggered introduction of this?  The 55-57 overnight change (which could soon be 55-58).  

It seems to be a cliff edge and for the sake of being born a minute later than another person, someone who is thinking about retirement with their peers has to wait two years (possibly three) 'because tomorrow comes'??  I'm so surprised that I haven't seen Martin talk more about this.  Have I got this wrong?

Forgive me if I have but I am 55 weeks before 6 april 2028 and intend to access my private pension and retire.  My wife is 55, days after 6 april 2028 and intended the same - she/we now have to wait two tears (likely three) before she can do the same.  To all intents we are the same age but one is being unfairly discriminated against in the most maximum of ways.

Also, I've seen that 'anyone born after 6 April 1971' is affected?  What is the relevance of this birth date in relation to being 55 before 6 april 2028?  I was born in 1972 but am 55 before 6 april 2028?

Very grateful for assistance.

hugheskevi

Why is there not a tapered/staggered introduction of this?  The 55-57 overnight change (which could soon be 55-58).  

Simplicity and historic precedent of changes being cliff-edge rather than taper.

I'm so surprised that I haven't seen Martin talk more about this.  Have I got this wrong?

People have little concern for the plight of those with resources to retire many years before most will.

My wife is 55, days after 6 april 2028 and intended the same - she/we now have to wait two years (likely three) before she can do the same.  To all intents we are the same age but one is being unfairly discriminated against in the most maximum of ways.

If your wife had an unfettered right to take her pension at age 55, she will have a protected minimum pension age (has she checked?). If she did not have an unfettered right then she could never have relied on being able to take her pension age 55.

To be unfairly discriminated against there has to be either no legitimate policy cause or it was not enacted proportionately. It is doubtful a court would find there was not a legitimate cause, and the establishment of protected minimum pension ages would be likely to be sufficient to argue that although age discriminatory, it was enacted proportionately.

af1963

The raising of the state pension age was phased in, during a transition period, each month that passes means people with birthdays in that month must wait an extra month after age 66 to get the pension.

This change  to pension access age could have been phased the same way, staying 10 years before state pension age.

Although perhaps Logan72 has reason to be grateful that it wasn't , or else we'd already be using 56 as the starting age, and he'd be waiting until almost 57 too. 

bjorn_toby_wilde

legLogan72 said:

Why is there not a tapered/staggered introduction of this?  The 55-57 overnight change (which could soon be 55-58).  

It seems to be a cliff edge and for the sake of being born a minute later than another person, someone who is thinking about retirement with their peers has to wait two years (possibly three) 'because tomorrow comes'??  I'm so surprised that I haven't seen Martin talk more about this.  Have I got this wrong?

Forgive me if I have but I am 55 weeks before 6 april 2028 and intend to access my private pension and retire.  My wife is 55, days after 6 april 2028 and intended the same - she/we now have to wait two tears (likely three) before she can do the same.  To all intents we are the same age but one is being unfairly discriminated against in the most maximum of ways.

Also, I've seen that 'anyone born after 6 April 1971' is affected?  What is the relevance of this birth date in relation to being 55 before 6 april 2028?  I was born in 1972 but am 55 before 6 april 2028?

Very grateful for assistance.

I’m pretty sure the change from 55 to 57 was first announced over ten years ago.

Plenty of time for you to plan for this surely?