We’ve all mostly been lead to assume that we can expect to happily retire at the age of 65 – pack up our working bags, ditch the commute, and finally relax in the company of a handsome(ish) pension pot.
But you might need to think again, as a recent pensions review has revealed that we may now have to work until we’re 68 years old.
The retirement age was due to rise from 67 to 68 between 2044 and 2046. But the review, conducted by the Government Actuary Department, has suggested that this date needs to be brought forward, and that the retirement age should become 68 much sooner.
So what does this mean? Well, if the change did happen, the earliest it could occur would be in 2030. This would then mean that everyone who is now under 54 might have to work a year longer than they originally thought. This, however, is the worst case scenario, and would only happen if the change was brought forward by around 16 years.
And, in a best case scenario, the age at which you can receive your pension would be brought forward in 2041, which would affect people who are now in their early 40’s.
Reportedly, the GAD’s report is based on accounting for increasing life expectancy in the UK. Apparently, the report is also designed to make the pensions system more affordable, according to the Daily Mail.
But former pensions minister Baroness Altmann has criticised the possible change, saying that “I would have thought the Government would be unlikely to go this far, but it is certainly possible.
“If it did, it would be grossly unfair and a bad policy decision. It is unfair to keep raising the state pension age on these arbitrary forecasts of average life expectancy.”
Ministers are currently debating a change to the pensions timetable, and it’s expected that a decision – influenced by these findings – will be reached by Work and Pensions Secretary Damian Green in May.