As Independent Financial Advisers, we are constantly reviewing the shifting issues that affect your financial planning needs. One of the most significant matters that has been on the horizon for some time is the change in the minimum pension age.
The government has announced that it is to undertake a review on raising the normal minimum pension age (NMPA) from 55 to 57 in 2028.
The NMPA is the minimum age at which most people can access their personal pensions without suffering an unauthorised payments tax charge.
In the consultation paper published on the 11th February, the government confirmed that the NMPA is to remain around 10 years under the state-pension age which is due to rise to 67 by 2028.
The government view, is that changing the minimum pension age to 57 matches peoples increased life expectancy and how long people plan to remain in work for.
The government also feels that raising the NMPA could encourage individuals to save longer for retirement, ensuring a stable income in retirement.
The government is also looking to put in place safeguards for the increase for all types of registered pension schemes. This means an individual member who currently has the right under their current pension scheme rules to take pension benefits below the age of 57 will be protected from the increase.
Members of the firefighters, police or armed forces public service pension schemes will not be affected by the increase.
The consultation period is due to end in April 2022.
If you are concerned that you may be affected by these changes, please contact your adviser at Westerby who will be happy to discuss any implications and potential solutions with you.