When will you be able to retire?
The Government wants to raise the State Pension Age (SPA) at a faster rate. Raising the SPA has been on the agenda for some time and pressure to save costs has resulted in the effective dates being brought forward. A proposed increase to the SPA to age 66, and then to age 67, has already been announced and those increases are due to go ahead in 2018 and 2026 as planned. The proposed increase to age 68 was due to take place in 2046, but the Government now want to bring this forward to 2036.
These changes, along with previously announced measures, could save the Government around £500 billion from pension expenditure over the next 50 years. This level of savings means that the increases in SPA are inevitable. Potentially it means someone born today is unlikely to receive any state pension benefits until at least their 72nd birthday!
Until recently, the SPA has been the trigger for clients receiving benefits from any private or employer-based pension plans. However, this does not have to be the case, because benefits from other pensions can be taken before the State pension starts. The topic of ‘bridging the gap’ between actual retirement and the SPA will start to become increasingly important.
robinson+co recognise the impact these changes will make on many clients’ plans for retirement. The key message is that the State Pension alone will not be enough to provide a comfortable retirement, and for those who wish to retire before their SPA (whenever that might be!) some form of retirement planning will be essential. Retirement planning can come in many guises and does not have to mean a pension plan.
If you would like to speak to one of our experts to ensure you have sufficient provision for your retirement please contact Jenny Armstrong, robinson+co’s Chartered Financial Planner on 01900 603623 or email@example.com