After the lingering expectation of rising state pension ages, it’s finally happened. The state pension age has officially risen for the millions of men and women born from December 1953 onwards. The state pension age has increased from 65 to 66. The days of hardworking Britons claiming their state pension at the age of 65 are now over. Anyone born from December 6, 1953, onwards will have to wait a little longer for their pension pots to mature under the new rule. Great, now what? What does this mean in the long run for those anticipating retirement and what challenges can people expect? For one, this change could potentially cost them thousands of pounds (around £8000 to be exact). This rise comes as a direct component for reforms that are designed to cut billions from the UK’s welfare bill. The state pension age is expected to gradually increase from 65 to 66 until 6 October 2020. Eventually, it’s due to increasing yet again to 67 by 2028 and 68 by 2039. For men, this is the first state pension increase since the modern system was established way back in 1948. On the other side of the gender fence, the state pension age has increased from 60 to 65 for women over an eight-year period. As of now, both men and women are affected by this new move. The public reacts Upon learning that state pension commencement will be introduced in increments, some have slammed the process, calling it a “cruel lottery”. There are various age group “slots” who will experience the effects of the rule in different ways. Those with born between December 6, 1953, and January 6, 1954, for instance, could face up to a three-month wait to retire, because the date they can claim their pension pot is March 6, 2019. What’s more, these changes could, in the long run, have a significant impact on people’s finances and the younger generation will have to start preparing for rises in the state pension age to 67 and 68. Security in retirement in the UK has likely never, so clearly, been called into question. It’s a clear signal for younger people and savers from all age groups that everyone will have to provide and fend for themselves. Millions of people are still unclear about the details of the new rules and how the process will be carried out but in time, things will hopefully be made clear. People who aren’t able to carry on working could be in for a nasty shock, which has led parties like Age UK to call for the government to allow early access to the state pension for those affected by changes. Thought-provoking (and rather concerning) questions are now being brought to the forefront. The hundreds of thousands of people in their 50s and 60s who are unable to carry on working today and who aren’t doing well financially may feel the most damage. Longtime manual workers crippled by arthritis, caretakers who have given up work to look after ailing partners, these are all people that currently face the prospect of being financially thrown off while waiting to claim their state pension.
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