How Will The State Pension Changes Affect You?

It was announced last Wednesday that the rise in the state pension age is being brought forward to between 2037 and 2039. The original plan had been 2044. The rise in the age to 68 is designed to fit the likelihood that life expectancy will continue to rise.

David Gauke, the Secretary of State for Work and Pensions, said, “As life expectancy continues to rise and the number of people in receipt of state pension increases, we need to ensure that we have a fair and sustainable system that is reflective of modern life and protected for future generations.”

Here’s how the changes could affect you…

-The change will most impact those born between 6 April 1970 and 5 April 1978. If you are between the ages of 39 and 47, which is six million men and women, you will have to wait a year longer to receive your state pension.

-Everyone under the age of 47 will have to work until they are 68 to receive the state pension.

-If you were born on or before 5 April 1970, you won’t see a change to your current state pension age.

-If you were born after 6 April 1978, nothing has changed, the state pension age was already due to rise to 68.

-On the plus side with this change, the government says the move will save the taxpayer £74 billion by 2045/46. Instead of 6.5% of GDP being spent on the state pension in 2039/40, the figure will be reduced to 6.1%.

-You can check your state pension age and find further information at the government’s website.

-You may want to think about a personal pension or investment to ensure that your retirement is as comfortable as you’d like it to be. With True Potential Investor you can set a goal and track it. Learn more at tpinvestor.com

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