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HM Treasury has confirmed the government’s intention to raise the normal minimum pension age from 55 to 57 in April 2028.

This change in legislation will impact millions of people who were planning on accessing their pension benefits at the age of 55 and is in response to increases in longevity and changing expectations of how long people will remain in work and in retirement – which is not new news.

This change is intended to maintain the 10-year gap between the age at which you can access your state and private pensions and pension schemes can choose how to implement the rise so long as it is accomplished by April 2028.



The Protection Regime


The government is, however, devising a “protection regime” to ensure members of some pension schemes keep their current rights to access their benefits at age 55.

Such a scheme would see existing scheme members retain their right to access their pensions at 55, while those who become members of schemes after 12th February 2021 will be subject to the updated rules.

Some professions will not have the age increase applied to their schemes at all because of their special circumstances – this includes members of the police, firefighters and the armed services.



So let’s look at an example


If you start a new job and are auto-enrolled into a scheme from the day after the consultation on 12th February 2021, you will lose the ability to access your pension at age 55.

One key consideration if you decide to consolidate various pensions into one plan for ease of managing them as you approach retirement, is to make sure you don’t accidentally throw away protected rights to access one or more of your pensions at age 55.

Because if you decide to take pension benefits before age 57 you will, as of April 2028, be subject to unauthorised payments tax charges.

So there’s a lot to consider if you’re starting a new job and enrolling in a new pension scheme, or planning at what point you can access your pension benefits.

Be sure to get advice from  a qualified pension adviser about your specific situation if you’re concerned or feel you may be affected.

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