New plans announced in July mean that the rise in the pension age to 68 for men and women will now happen by 2039 (7 years earlier than planned), and will affect 5.8 million people aged between 39 and 47.
What does this mean?
The increase affects those born between 6 April 1970 and 5 April 1978, who will now get their state pension a year later than expected. It will also affect public sector pensions, whose workplace retirement is linked to the state pension and even for private sector workers, there is a chance it may affect their workplace pension too.
What about future generations?
The scope for state support is diminishing, and it’s likely there will be further rises in subsequent years, meaning young people, without careful planning, may be looking at working well into their seventies. The advice here is to put aside as much as you can reasonably afford each month and benefit, where you are able, from employer contributions.
What can you do now?
This change highlights the importance of planning for your retirement. As we are likely to live longer and want to enjoy our retirement without money worries, we need to plan ahead and start saving now, in order to avoid too much reliance on the state pension.
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