It used to be simple.
You worked until you were 60 or 65, paid your stamp and when your landmark birthday arrived retired on the State Pension.
But then we all started living much longer and the economics of this simple age simply didn’t add up any more.
And so today, we have a hugely varied pensions landscape which, more often than not, leaves most of us scratching our heads with complete and utter bewilderment.
So here’s a few basic facts about the State Pension to put you on the right lines.
The current State Pension changing. It’s gradually increasing for women from 60 to 65 and will this year increase for both men and women to reach 66 by October 2020.
And that’s not the end of the changes. The Government is planning further increases and the age will rise to 67 between 2026 and 2028.
It’s confusing isn’t it? But the Government has developed an online tool which allows you to check very easily when you can retire. Click here and follow the instructions: https://www.gov.uk/state-pension-age
You can also use the online link to check how much State Pension you are in line to receive. It’s based on your National Insurance contributions and you’ll typically need to have clocked up at least ten years of payments to qualify for anything.
The full State Pension is currently £164.35 a week –just over £8,500 a year. But because it takes into account your NI payments, it will vary from person to person, so it’s well worth checking out what your individual prediction says.
And if you think you need to do something to start building it up, there is also advice on how you might be able to do that.
Of course, there is no need to give up work the day you reach your State Pension age. You can still claim your entitlement and carry on working and enjoy the added benefit of not having to pay any further NI contributions.
And you also have the right to carry on working with flexible hours, if you think that would suit you best. Talk to your managers well in advance of your retirement date to see what you can sort out.
These details all apply to the State Pension – and it is highly likely you will have made extra provision through a workplace pension or personal pension to top up what you can expect to receive in retirement. We’ll look at some of these schemes in future blogs.
In the meantime, if you need any advice or help on your State or other pensions, click the button for your free consultation.