A TO-AND-FRO in government over future rises in the State Pension age has put the future of the old-age payment in focus once again.

There are already longstanding plans to increase the age at which you can claim the State Pension. Currently 66, the age will rise to 67 between 2026 and 2028. The question is when it will rise to 68?

Until recently, the government had suggested it would follow guidance from 2017 and raise the age to 68 in the late 2030s - affecting anyone born after 1977. Now the government says it will delay a decision on that change.

Increasing the State Pension age has obvious attractions for the government because it means paying future retirees for one year less. From next month, the full State Pension will be worth £203.85 a week - or £10,600.20 a year.

But raising the age is unpopular and not supported by current trends in life expectancy. Life expectancy at age 50 has fallen since 2006. So, a man born in 1971 who made it to age 50 would, under the 2006 projections, be expected to have a life expectancy of 86.3 years. Under 2016 projections that had fallen slightly to 85.6. And under the latest 2020 projections it had fallen to 83.9 years1.

It’s hard for the government to justify delaying when you’ll get the State Pension if you’re also likely to live a shorter life.

Working out when you’ll get your State Pension - and how much it will be - is important because it is likely to form a crucial part of almost everyone’s retirement plans. For those entitled to it, the payment is guaranteed, meaning that it can be relied upon to put towards essential spending. Not only that, but it is also likely to increase every year.

It makes sense, then, to make sure you get the maximum State Pension possible. Your entitlement to the State Pension is based on your National Insurance (NI) contributions. To get the full State Pension you need to have made NI contributions for 35 complete years by the time you retire.

Those working as employees are likely to have NI taken automatically from their pay, while self-employed people with earnings above a certain level will pay their contributions via self-assessment.

The government has an online service that lets you check on your NI record for any gaps and to see whether you’ll get the full amount. You’ll need a Government Gateway account, which you can sign-up for using details from your passport, payslips or P60.

It can also be possible to increase your state pension by delaying the point at which you take it. To do that you need to be able to do without the payment for a period of time - and with the State Pension age now 66, not everyone will be able to wait even longer for it. 

If you can, delay, however, you can increase the amount you’ll get in the future. Your State Pension will increase every week you delay taking it if you delay for at least 9 weeks. You get extra State Pension increases of 1% for every 9 weeks you delay taking out your pension. This works out at just under 5.8% for every 52 weeks. By delaying taking your pension for 52 weeks, you’ll get an extra £11.82 a week based on the full State Pension from April2.

The Government’s Pension Wise service offers free, impartial guidance to help you understand your options at retirement. You can access the guidance online at www.moneyhelper.org.uk or over the telephone on 0800 011 3797.

Important information - investors should note that the views expressed may no longer be current and may have already been acted upon. This information is not a personal recommendation for any particular investment. If you are unsure about the suitability of an investment you should speak to an authorised financial adviser of your choice.

This is based on our interpretation of recent regulation announcements. They are reliable at the time of writing, may not be all-inclusive and their accuracy are not guaranteed. They may be subject to change without reference or notification to you.

Withdrawals from a pension product will not be possible until you reach age 55, this is due to change to 57 in 2028.

1 National life tables – life expectancy in the UK - Office for National Statistics (ons.gov.uk)
2 Benefit and pension rates 2023 to 2024 - GOV.UK (www.gov.uk)

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