State pension age starts rising to 67 – here’s how much you get and when
State Pension Age Increases, With Payments Also Raising
Beginning this week, the state pension age for millions of individuals is gradually shifting to 67, coinciding with an annual adjustment in pension amounts. The current threshold is 66, but this transition will occur in increments over the next two years. Those born between 6 April and 5 May 1960 will experience the earliest changes, requiring an additional month to qualify for their pension.
Experts cite longer life expectancy as the rationale for the shift, with younger generations projected to work well into their 70s. However, the government remains open to further adjustments. Peter Bradbury, a resident of Preston, is set to receive his state pension at 66 years and eight months. “It’s frustrating,” he said on BBC Radio 4’s Money Box, noting his initial expectation of retiring at 65. “I’ll have to keep working, and my travel plans will be delayed.” While daily expenses remain unchanged, he highlighted the loss of “those little extras” once retirement begins.
“I’ll do some other work and I can’t travel as much as I wanted to.”
Public Concerns About Future Changes
At a music gathering in Liverpool, attendees voiced worries about ongoing pension reforms. Laura Williams, 38, from Netherley, expressed uncertainty about her financial future: “By the time I reach pension age, I’ll probably be around 70,” she said. She fears that by then, her physical condition might not support the lifestyle she envisions, such as pursuing hobbies or travel.
“The things you might put off doing until you have got the freedom, and maybe the finances, to do it, your body might not be able to do by then.”
Financial Implications and Policy Details
The gradual shift to 67 is anticipated to save the Treasury approximately £10 billion annually by 2030. To qualify for a full pension, individuals generally need 35 years of qualifying national insurance contributions. This year, payments will rise by 4.8%, matching average wage growth, under the triple lock policy. The policy ensures that pensions increase based on either wage growth, inflation, or a minimum rate of 2.5%, whichever is highest.
Some people may face gaps in their national insurance records due to periods abroad or time spent caring for children. Charities argue that the pension age rise will disproportionately affect regions where healthy life expectancy is lower, particularly those with limited financial resources. For instance, men in Blackpool are expected to live independently until nearly 52, compared to nearly 70 in Wokingham, Berkshire.
“The people most affected are often those least able to adjust through staying in work or drawing on other savings.”
Laurence O’Brien, a senior research economist at the Institute for Fiscal Studies, added: “There is a good case for future increases to come alongside targeted financial support for vulnerable groups.” Earlier changes to the pension age sparked debate, notably the Waspi campaign, which criticized the lack of notice for women affected by the policy. The Institute for Fiscal Studies noted that some individuals relied on private savings to offset the impact, though the reforms also linked to reduced life satisfaction and higher employment rates among retirees.
Legislation currently plans to raise the pension age to 68 between 2044 and 2046, with a review to assess potential modifications. Elaine Smith, head of employment and skills at the Centre for Ageing Better, explained that the policy aims to align with extended lifespans. However, she pointed out that national life expectancy has slightly declined since the pandemic. A DWP spokesperson emphasized the commitment to supporting individuals financially at any stage: “Those not yet eligible can access universal credit and other means-tested benefits.”
Listen to further discussions on Money Box at 12:00 BST on Radio 4 or later on BBC Sounds.
