State Pension Age Review: What It Could Mean for Your Retirement Planning

The UK government has announced a review into the State Pension age as part of its work on pension adequacy – a move prompted by growing concerns that many people may not have enough to live on in retirement.

One possible outcome? The planned increase in the State Pension age from 67 to 68, currently scheduled for the mid-2040s, could be brought forward by as much as a decade.

Some experts believe the review could also lay out a timetable for further rises to ages 69, 70 and beyond. While nothing is confirmed, it’s worth considering what this could mean for you – and, crucially, what steps you can take now to prepare.

What Will Be Considered in the Review?

Several key factors will be in the spotlight:

1. Longevity – How Long We’re Living

The UK has an ageing population and, for decades, we’ve been living longer. That means the State Pension is paid to more people, for more years – a costly commitment for the government.

However, recent data shows life expectancy growth has slowed, especially after the pandemic. The last review was expected to bring forward the age 68 change to the mid-2030s, but this decision was postponed until more post-pandemic data could be analysed.

2. Healthy Life Expectancy – How Long We’re Healthy Enough to Work

While we may be living longer, healthy life expectancy – the years we can expect to be in good health – often sits in the early 60s.

If people leave the workforce due to ill health at this stage, they could face a gap of several years before they’re eligible for the State Pension. Increasing the age widens that gap further, putting more pressure on personal and workplace pensions to bridge it.

Two Ways to Prepare for Possible Changes

Although any change will take years to implement, it pays to prepare now so you’re in control of your financial future.

1. Track Down Any Lost Pensions

It’s surprisingly easy to lose track of a pension, especially if you’ve changed jobs or moved house without updating your details. These ‘forgotten’ pots could be worth thousands.

• Make a list of every employer where you think you had a pension.

• If you’re missing paperwork, use the government’s Pension Tracing Service – they can give you the provider’s contact details so you can check directly.

2. Review and Consolidate Your Pensions

Bringing all your pensions into one place can make them easier to manage, reduce admin, and even cut costs. However, check for exit fees or valuable benefits (such as guaranteed annuity rates) before moving anything.

Boosting Your Retirement Savings

Even small actions can make a big difference over time:

• Increase contributions – Many employers will match higher contributions above the minimum, so boosting yours could mean more going into your pot with little extra cost to you.

• Consider a private pension – If you’re self-employed or want extra flexibility, a Self-Invested Personal Pension (SIPP) gives you control over contributions and investments, while benefitting from tax relief and tax-free growth.

• Make use of pay rises – Increasing your pension contributions when your income rises can steadily build your retirement savings without affecting your current lifestyle too much.

  
  

Remember, you generally can’t access your pension until age 55 (rising to 57 in 2028).

Final Thoughts from Cleveden Park Wealth

Changes to the State Pension age could impact when you retire and how much income you’ll need from your own savings. By taking steps now – from tracking down lost pensions to making the most of contributions and tax relief – you can build a stronger, more flexible retirement plan.

Ready to review your pension strategy? Our advisers can help you understand your current position, explore your options, and create a plan that works for you – whatever the future holds for the State Pension.

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