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What Is My Retirement Age?

Last updated 29th November 2021

5 min read

a loving senior couple sitting on a sofa

Understanding your retirement age can help you to plan for your future and make informed financial decisions. Fortunately, the UK no longer has a default retirement age, meaning you have complete freedom over when you choose to retire.

To make that important decision, however, there are certain considerations you may want to think about - such as when you are able to claim your pension and whether you wish to stop working at a certain age.

In this guide, we explore the UK’s current retirement age, both the State and personal pension age and future plans which may affect when you can claim your pension.

When can I retire?

As of October 2011, there is no longer a default retirement age (DRA). Previously, the DRA allowed employers to enforce retirement at age 65, however it’s now up to you to decide when to retire from working.

You may wish to retire much earlier than 65, while others may wish to continue working past 65 at reduced or full hours to continue earning an income.

The choice is entirely yours, but it’s important to understand that the age at which you retire is not necessarily the same age you can access your State or private pension pot. Don’t worry, we’ll explain this in more detail later in this article.

Forced retirement

While there is no longer a default retirement age, there are some cases where retirement can be forced. For example, employers can enforce a ‘compulsory retirement age’ if there is a justifiable reason. These can include:

  • If the job has a legal age limit (eg. the fire service)
  • If certain physical abilities are required to safely complete the job (eg. the construction industry)

In that case, you may be lawfully required to retire at a certain age to keep yourself and others safe.

What is the State Pension age?

At the time of writing (October 2021), the State Pension age is 66 for both men and women. This means you will not receive payments from your State Pension until you are 66 years old, even if you retire at an earlier age.

However, there are some changes and important dates coming up which may impact when you can access your pension.

Since 2018, the State Pension age has been increasing with future plans to increase even further in the hope to align pension age with life expectancy. For both men and women:

  • In 2018, the State Pension age was 65
  • By 2028, it is planned to increase to 67
  • By 2046, it is planned to increase once again to 68

As the changes are taking place as a gradual increase, your official State Pension age will depend on when you were born. You can use the online government calculator to find out the earliest age you can receive your State Pension, though any further legislation changes will not be taken into account.

Will I receive my State Pension automatically?

No, you won’t receive your payments automatically. Usually, you will receive a letter 4 months before you reach State Pension age giving you instructions on how to make a claim.

You’ll be able to do this over the phone, by requesting a form or by claiming online - just make sure to have your National Insurance number to hand!

When can I withdraw money from a personal pension?

You can usually begin withdrawing money from your personal pension from the age of 55, however the government is likely to increase this to age 57 by 2028.

Some pension providers may ask for a selected retirement age. This is the age you indicate to your pension provider that you are likely to retire, or when you’re likely to want to receive your pension.

If you wish to take out your pension before the selected retirement age, this could impact the amount you are owed. As always, it is best to check in with your pension provider to understand your options before making any decisions.

Retiring due to ill-health

Unfortunately for some of us, physical or mental ill-health can result in an unplanned early retirement. If you need to retire early due to ill-health and are no longer capable of working, you may be able to access your personal pension before the age of 55 – see our guide to ill health retirement for more information.

In that case, some pension providers may give you early access to your pension pot, including the option for higher payments, but you should check this with your provider.

If your life expectancy is less than a year, it may be possible to take your entire pension out as a tax-free lump sum. However, there are certain conditions that must be met:

  • You have a life expectancy of less than a year due to an illness
  • You do not have more than £1,073,100 in pension savings (the current lifetime allowance)
  • You’re under 75

You can check with your pension provider to find out whether they offer early access options for physical or mental ill-health. In the meantime, check the gov.uk website for more details.

Can I still work while receiving my pension?

Yes - as there is no forced retirement age, you are able to continue working full or part time whilst receiving your pension payments. From saving money to loving your job and the people you work with, continuing employment later in life can bring many benefits.

It is also possible to continue paying into your pension pot while taking money from it. Your employer may offer a matching scheme which can help you save more, topping up your pension as you withdraw money from it.

This can be beneficial for individuals who have reduced their hours to part-time and need their pension payments to make up the difference in income - while giving them the opportunity to continue saving into their pension with the accompanying tax benefits on pension contributions.

Why is the pension age changing?

As explained by the Government, the State Pension age must stay in line with the UK’s life expectancy to remain fair and affordable.

The number of pensioners above the State Pension age is also continuously increasing, with numbers expected to grow by a third between 2017 and 2042. Essentially, more pensioners than ever are currently receiving State Pension, for a longer period than anyone else before them.

The State Pension age is under continuous review, meaning it is subject to change whenever deemed necessary. At the time of writing (October 2021), the pension age is 66, however it is worth keeping an eye on the government website to check your state pension age.

Continue reading

If you’d like to learn more about pensions, retirement or life after 50, you may want to read these articles listed below:

If you’d like to speak to a member of our friendly team, get in touch today to find out how we can help.

Sources

  1. GOV.UK - Default Retirement Age to end this year
  2. GOV.UK - Early retirement, your pension and benefits
  3. National Population Projections: 2014-based projections
  4. GOV.UK - Proposed new timetable for State Pension age increases