The State Pension age is set to start rising from 66 to 67 next year, with the increase due to be completed for all men and women across the whole of the UK by 2028
The State Pension age is set to undergo a hike from 66 to 67 starting next year, with the rise expected to be fully implemented for all UK men and women by 2028.
This adjustment to the official retirement age has been on the legislative books since 2014, with another increase from 67 to 68 slated for implementation between 2044 and 2046.
The Pensions Act 2014 expedited the increase in the State Pension age from 66 to 67 by eight years. The UK Government also tweaked the phasing of the State Pension age increase, meaning that instead of hitting State Pension age on a specific date, people born between March 6, 1961, and April 5, 1977, will be eligible to claim the State Pension once they hit 67.
READ MORE: Shoppers heap praise on £20 gum serum that ‘works wonders’ and helps ‘reduce inflammation’
It’s crucial to keep abreast of these impending changes, particularly if you’ve got a retirement plan in place. All those impacted by alterations to their State Pension age will receive a heads-up letter from the Department for Work and Pensions (DWP) well ahead of time.
Under the provisions of the Pensions Act 2007, the State Pension age for both genders will see an increase from 67 to 68 between 2044 and 2046.
The Pensions Act 2014 mandates a regular review of the State Pension age, at least once every five years. These reviews will hinge on the principle that individuals should be able to spend a certain portion of their adult life receiving a State Pension, reports the Daily Record.
A review of the proposed increase to 68 is due before this decade ends, initially scheduled by the previous Conservative government to occur two years post-general election – which would have been 2026.
The State Pension age review will consider life expectancy and other relevant factors. Following the review’s findings, the UK Government may decide to implement changes to the State Pension age.
However, any suggested changes must pass through Parliament before becoming law.
Check your State Pension age online
Your State Pension age is the earliest you can begin receiving your State Pension. It might differ from the age you can access a workplace or personal pension.
The online tool on GOV.UK allows anyone of any age to check their State Pension age, an essential step in retirement planning.
You can use the State Pension age tool to check:
- When you will reach State Pension age
- Your Pension Credit qualifying age
- When you will be eligible for free bus travel – this is at age 60 in Scotland
Check your State Pension age online here.
Enhancing State Pension payments
HM Revenue and Customs (HMRC) recently revealed that over 10,000 payments totalling £12.5 million have been made by individuals using the new digital service to enhance State Pensions since its launch last year.
However, those eager to maximise their retirement income through the contributory benefit only have a few weeks left to fill any gaps in their National Insurance (NI) records dating back to 2006.
Typically, folks are restricted to back-paying voluntary contributions for just the previous six tax years, but hold your horses because after April 5, this year, that standard six-year limit kicks back in.
In a twist for 2023, the powers-that-be from the last regime stretched the pay-in period for voluntary National Insurance contributions right up until April 5, 2025. This is a special deal aimed at those caught up in the New State Pension transition shenanigans, covering the time span from April 6, 2006, to April 5, 2018.
The bonus time is a boon for many, giving extra breathing space to mull over their options and make their contributions without a mad dash.
Eligibility to top-up your New State Pension via voluntary NI contributions is quite specific: Gents need a birthdate after April 6, 1951, and ladies after April 6, 1953.
But wait, it’s not always about footing the bill—an entitlement to NI credits might mean no contribution necessary—but sorting out what you’re due requires a good rummage through the details.
Curious punters can suss out the nitty-gritty on making voluntary contributions at GOV.UK right here. The working crowd can also snag a glimpse of their State Pension forecast at GOV.UK over here.
Chiming in with some sage advice, Alice Haine, personal finance analyst at digital wealth manager Bestinvest by Evelyn Partners, said: “People typically need at least 10 qualifying years of NI (national insurance) contributions to receive any state pension at all and at least 35 years to receive the full new State Pension – though they don’t need to be consecutive years.”
Addressing the costliness of securing a full State Pension, an expert has sounded the alarm on the significance of evaluating the need to fill any holes in one’s National Insurance record.
“Plugging gaps can be quite an expensive process, so it is important to assess whether you actually need to buy back any missing years. This will depend on how many more years you plan to work, and whether you are eligible for NI tax credits, which fill the gaps, such as those who have been sick, were unemployed or took time out to raise a family or care for elderly relations.”
The task of topping up your pension contributions has become a lot more straightforward since the Government introduced new online NI payments services last April, alongside a State Pension forecast tool that over 3.7 million people have utilized since its debut.
She went on to explain: “People simply need to log into their personal tax account or the HMRC app to not only view any payment gaps but also check if they can plug those gaps directly through the Government’s digital channels.”
She mentioned a beneficial quick survey that estimates a user’s compatibility for making online payments, allowing those who qualify to choose how to bridge any lapses, influenced by when they anticipate retiring.
“Calculating whether to top up can be confusing though and ultimately there is no point paying for more years than you need because you won’t get that money back.”
Ms Haine offered further insights: “People who might need to top up include those that took a career break as well as low earners or expatriates living and working abroad.
“Remember, this deadline has been extended a couple of times in the past, which makes it more likely the Government will stick to the April cut-off point this time around. For this reason, those that think they might need to take action should start the process now.”