Starting in 2026, millions of households will be impacted by a significant change to the state pension system. The state pension age is scheduled to increase from 66 to 67, meaning that individuals born on or after March 6, 1961—currently up to 64 years old—will need to wait an extra year before claiming their pension.
This adjustment will be implemented gradually over two years, reaching the new pension age of 67 by 2028. As a result, many people currently planning to retire at 66 may need to extend their working years by at least one additional year.
Looking further ahead, the pension age is expected to rise again to 68 by the mid-2040s. However, this timeline may be accelerated pending the outcome of an ongoing government review.
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Rachel Vahey, Head of Public Policy at AJ Bell, commented on the changes, stating, “An increase from 66 to 67 is confirmed for 2026 to 2028. However, the future beyond that is less certain. While age 68 is projected for 2046, a faster rise is quite possible.”
Understanding these changes is crucial for effective retirement planning. With the state pension age shifting, millions will need to reassess their financial strategies and potentially adjust their retirement timelines accordingly.