Fears over rise in retirement age - Pensions - News - Moneyfacts


Fears over rise in retirement age

Fears over rise in retirement age

Category: Pensions

Updated: 13/01/2010
First Published: 13/01/2010

This article was correct at the time of publication. It is now over 6 months old so the content may be out of date.

Concern has been raised that people are still unaware of the imminent rise in the minimum retirement age.

From 6 April, the earliest age at which people will be able to retire is to rise from 50 to 55.

Yet nearly half (47%) of 45 to 49 year olds and around two-fifths (39%) of 50 to 54 year olds are unaware of the change, according to research from Prudential.

It has been warned the increase could come as a particular blow to people aged 50 to 55 who are planning to retire this year.

The new rules will prevent prospective retirees in this age range from claiming private or company pension benefits and from taking the tax-free cash element of their pension fund until they are 55.

For those who had planned to retire at 50, the higher minimum age will mean five years without access to pension benefits or tax-free cash.

"People who want to take their pension benefits and any tax-free cash allowance still have nearly three months to decide what they want to do," said Karin Brown, the insurer's director of annuities.

"The Government first announced the changes to minimum retirement age nearly six years ago so there has been plenty of time for the news to sink in. It is worrying that so many are still unaware, but there is time to act before rules change."

Compare pensions

Disclaimer: Information is correct as of the date of publication (shown at the top of this article). Any products featured may be withdrawn by their provider or changed at any time.

Related Articles

Savers more worried about looks than pension

When you think of getting older, what’s the first thing that comes to mind? For many, it’ll be fears about their looks – but they should really be concerned about their financial situation.

Pension funds defy uncertainty with strong returns

Economic uncertainty has been a persistent theme in recent months, but happily, not every area has been negatively impacted. Indeed, our latest figures show that the pension sector has bucked the trend and posted unexpectedly strong returns.

Do you know what a pension is?

Pensions are something we all need to get our heads round, and we’re continually told that it’s important to start saving into one from as early as possible. Yet new research suggests that this advice could be falling on deaf ears.