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Pension Age Changes: What You Should Know

The UK’s state pension age has been a hot topic in recent years, with further increases planned for the coming decades. While the official pension age is currently set at 66, discussions are underway to bring forward the planned rise to 68, which could significantly impact those born between 1965 and 1974.

What’s Changing?

At present, the government’s scheduled increase of the state pension age to 67 is expected between 2026 and 2028. However, there are proposals to accelerate the rise to 68 as early as 2035 instead of the originally planned 2044-2046 timeline.

These changes are being driven by factors such as increasing life expectancy and a growing strain on public finances. This means that many in their 50s today may need to adjust their retirement plans and financial strategies accordingly.

What This Means for Your Retirement Planning

If the state pension age rises sooner than expected, this could have significant implications for those currently in their late 50s or early 60s. Here’s how you can prepare:

1. Review Your Retirement Timeline

If you were planning to retire at 66, you may need to consider alternative sources of income for an extra year or two. Check your latest state pension forecast on the Gov.uk website to see when you’re eligible.

2. Boost Your Pension Savings

With uncertainty around the pension age, it’s wise to increase contributions to your workplace pension or private pension. The earlier you boost your savings, the greater the benefit from compound interest.

3. Consider Part-Time Work

A record number of over-50s are working part-time or in self-employment as a way to manage financial security while enjoying more flexibility. This can be a great way to ease into retirement without a sudden loss of income.

4. Seek Professional Advice

A financial planner can help you make the best decisions about pension withdrawals, savings, and investments to ensure you’re well-prepared for a potential delay in your state pension.

Final Thoughts

The government’s review of the state pension age is ongoing, and changes may come sooner than expected. Being proactive now will ensure you’re financially secure, regardless of when you become eligible for your state pension.

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