The government has published an independent review on the state pension system.
There was a time when it was all so simple: men drew their state pension from age 65 and women from age 60. That all started to change in the mid-1990s, when the Pensions Act 1995 set in train a phased increase in women’s state pension age (SPA) to 65 from April 2010.
21 years, and many changes, later we are still waiting for definitive answers. The first stage of the latest independent review on the future of state pensions, commissioned by the government, was published for consultation last month. This review was carried out to meet a legislative requirement for periodic assessments of SPA and related matters. As such it raises a variety of issues, such as the differences in life expectancy between regions, localities and socio-economic groups and the practicalities of early or differential SPAs.
There are no specific recommendations, but instead a list of 26 consultation questions. The nearest the review comes to suggesting when SPA should move to the current target of age 68 is to refer to the Office for Budgetary Responsibility’s estimate that this should be “by 2041”, seven years earlier than currently legislated for.
Of course, you do not have to wait until your SPA to retire, but if you want to stop work earlier – or just have the option to do so – you’ll need to have adequate private pension or other investments in place.
The value of your investment can go down as well as up and you may not get back the full amount you invested. Past performance is not a reliable indicator of future performance.