More than 1.8 million people in their 50s and 60s are affected by increases in the State Pension Age. The State Pension Age is currently being equalised at 65 for men and women then from December 2018 it will start to increase to reach 66 by October 2020. It is then planned to increase to 67 between 2026 and 2028.
Those affected are set to receive their State Pension later than planned or with less income than they anticipated. It is hardly surprising, therefore, that research by retirement specialists Retirement Advantage has found that more than 1 in 4 over 50s (28%) have changed their retirement plans as a result.
However, this overall figure masks a disparity between men and women. Only 1 in 5 (21%) men have had to change their plans, whereas more than 1 in 3 (35%) women have had to.
In terms of the kind of changes people are making, 61% say they will retire 1-5 years later than planned (55% of women vs. 70% of men) while 23% say they will retire 6-10 years later than planned (29% of women vs. 13% of men). Again this shows the scale of the impact on women, who are putting their retirement off for longer. Additionally, 1 in 5 women (20%) say they will retire with less income than they had planned, compared to 1 in 7 men (15%).
This report suggests it is important for all over 50s to check their State Pension Age and how much they can expect to receive, but especially women. You can get a State Pension forecast online at https://www.gov.uk/check-state-pension
If your State Pension Age is higher than you previously planned for, you might find yourself with an income shortfall for a few years between your planned retirement age and your State Pension Age. Depending on your circumstances, you may need to work longer or it may be possible to build savings or use existing pensions, savings and investments to bridge the gap. Getting financial advice as soon as possible can help you ensure your retirement plans stay on track.