The majority of 50-year-olds are concerned about the shift in the age at which people can retire.
New research from TPT Retirement Solutions, a leading UK workplace pension scheme, reveals that 63 percent of 50-year-old workers are worried about the upcoming increase to the normal minimum pension age.
The minimum pension age determines when workers can first legally gain access to their pension savings.
In 2021, the Government passed legislation to increase the minimum pension age from 55 to 57 in 2028. Many workers aged 50 are concerned about the increase as more than one in five (21%) currently plan to access some of their pension savings before they turn 60.
The research also reveals that most workers aged between 50 and 59 are unaware of the normal minimum pension age. Just 35 percent of workers in this age group correctly identified that the current minimum pension age is 55. Half (50%) of these workers believed the minimum age was 60 or older.
Concern about a state pension increase in the 2030s
TPT’s research also reveals that more than three in four workers (76%) in their 50s are worried about any potential increase to the state pension age in the 2030s. The state pension age will rise to 67 in a phased introduction between 2026 and 2028, and then to 68 between 2044 and 2046. The Government had accepted the recommendation of an Independent Review, undertaken by John Cridland, that the state pension age increase to 68 should be brought forward to the 2030s. However, in March 2023, the Government delayed the decision over whether to bring it forward until the next Parliament.
Workers in their 50s are concerned, as only 15 percent are currently planning to retire at the age of 68 or older. More than seven in ten (73%) are planning to retire before they reach 68. However, these plans may potentially be disrupted if the state pension age does increase, as 74 percent of workers in their 50s state that they will rely on the state pension as a source of income in retirement.
More than half (51%) of those worried about an increase to the state pension age believe they deserve to retire at 66 as they have paid into the system for long enough. Nearly half (47%) expect they will be forced to work for longer as they can’t afford to retire without the state pension. More than a third (35%) are also worried about the increase in the pension age due to their health, life expectancy, or family circumstances.
David Lane, Chief Executive of TPT Retirement Solutions, comments:
“Our research shows the degree of concern many people in their 50s have about increases to the minimum and state pension ages. As the national minimum pension age increases, it is important for people to be aware of how this change may impact their retirement plans. Any further increases to the state pension age in the coming years will cause further worry for this age group.
“Given the number of people depending on the state pension as their primary source of income, many could be effectively forced to work for longer. Those with physically demanding jobs may find working for an additional two years particularly challenging. People in their 50s with a defined contribution pension should consider, where at all possible, increasing their pension contributions if they want to retire earlier or protect themselves against any future changes in the state pension.”
Amelia Brand is the Editor for HRreview, and host of the HR in Review podcast series. With a Master’s degree in Legal and Political Theory, her particular interests within HR include employment law, DE&I, and wellbeing within the workplace. Prior to working with HRreview, Amelia was Sub-Editor of a magazine, and Editor of the Environmental Justice Project at the University College London, writing and overseeing articles into UCL’s weekly newsletter. Her previous academic work has focused on philosophy, politics and law, with a special focus on how artificial intelligence will feature in the future.