Yahoo Finance State pension age changes: how will it affect you?
Millions will have to wait longer to get their state pension, the Government has revealed, but will you be affected?
Until this announcement, the state pension age was intended to increase from 67 to 68 between 2044 and 2046.
Now, there is a plan to bring this timetable forward, with the increase happening between 2037 and 2039 instead.
The Department for Work and Pensions put this down to necessity - due to the increasing financial burden of paying out state pensions to retirees who are living for ever longer in retirement.
Steve Webb, director of policy at life firm Royal London, said "The government is right not to have left this increase in the pension age until the mid-2040s. Without this decision people of working age would have faced a heavy tax burden.”
Who does this affect?
The six million affected people are aged between 39 and 47 today.
Under the previous plans, those born since April 6 1978 faced a state pension age of 68.
Based on the new plan, those born since April 6 1970 and April 5 1978 will be included as well. This includes both men and women.
At present, the state pension age is 65 for men and 64 for women. The latter will keep steadily rising every few months and the age will equalise at 65 for men and women in 2018.
The plan for what will happen after this, including the latest announcement, can be seen in the table below.
Is this definitely going to happen?
At present, this is merely the Government’s stated intention, and will need to be voted into law.
The Conservative party only has a slim majority in the House of Commons at present, which could prove problematic for such a controversial measure.
However, the Government has said the legislation confirming the new timetable doesn’t need to be in place until 2023 - one year after the next scheduled general election.
Tom Selby, senior analyst at Sipp provider AJ Bell, said: “This is simply kicking the can down the road. At some point politicians will have to make difficult choices about the state pension, particularly if life expectancy continues to increase.”
The outcome will therefore likely come down to who wins the next election, and how substantial their majority is.
The Labour Party has said it would review age increases beyond 66, but whether it would be able to freeze the state pension age will depend on a myriad of factors.
For a personalised estimate on the current plans, use the Government website gov.uk/calculate-state-pension or call The Pensions Service on 0800 731 7898.
