Warning to do three things ahead of state pension change | Personal Finance | Finance


People have been urged to take action as major changes are coming in to the state pension. The state pension is a crucial part of many people’s retirement, with the full new state pension now paying £230.25 a week, or £11,973 a year.

However, the access rules for the benefit are soon to change. From 2026, the age when you can start to claim your state pension will increase from 66 to 67. This will happen gradually, from April 2026 to April 2028.

Another rise in the state pension age is also set to take place, with the access age to increase from 67 to 68 between 2044 and 2046. Mike Ambery, retirement savings director at Standard Life, part of Phoenix Group, urged working age people to be mindful that with changes such as this, the state pension “may become less generous over time”.

He encouraged people to plan ahead, saying: “Building up private pension savings, engaging with workplace pensions, and seeking guidance on long-term financial planning are all crucial steps.”

Another way the state pension could be made less generous is if the triple lock is changed. This policy sets how much the state pension increases each April, guaranteeing payments rate go up in line with whichever is highest: inflation, the rise in average earnings, or 2.5 per cent. Thanks to the pledge, payments are expected to go up 4.7 per cent next April, in line with the earnings figure.

But experts have raised concerns that rising payment rates mean the triple lock could soon become unsustainable, forcing the Government to change the policy. Mark Pemberthy, benefits consulting leader at insurance advisory group Gallagher, said the policy is “unaffordable over the long term”.

He explained why he thinks this: “When wages or inflation spike, the bill for the Government rises dramatically. With public finances already under strain, reform is needed soon to avoid placing an unfair burden on future generations.”

The Government has set up a Pensions Commission to look at how to ensure people have enough funds to retire. Mr Ambery said: “The revival of the independent Pensions Commission offers a vital opportunity to rethink how we support people through longer working lives and ensure the system remains fair, sustainable and trusted for generations to come.

“By looking at savings adequacy and levels of dependence on the state pension it has an opportunity to inform the ongoing state pension age review, ensuring that any future changes are grounded in an understanding of how people rely on the system today.”

The state pension age review is a separate study, looking at where the state pension age should be set. The previous review suggested bringing forward the increase from 67 to 68, but this recommendation was not taken up by the previous Conservative Government.



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