ESSENTIAL INFORMATION FOR YOUR RETIREMENT PLANNING

A significant change is on the horizon that may affect when you can access your pension money. We’ll guide you through this change and its potential implications, so you can confidently prepare for retirement.

The current normal minimum pension age (NMPA) is 55, which means you can start taking your pension savings once you reach that age. Some exceptions exist, such as if you’re experiencing ill health or have a lower protected pension age. However, the general rule applies to most people. Starting from 6 April 2028, the NMPA will increase to 57. This change may affect you differently depending on your birth date. What does this mean for you?

WHAT ACTIONS SHOULD I TAKE? IF YOU WERE BORN AFTER 5 APRIL 1973:

It’s a good idea to review any existing plans to determine if the change will affect them. You may need to plan for another couple of years of saving, which could alter your retirement income. No action is required if you didn’t intend to access your pension savings before turning 57.

Regularly reviewing your retirement plans is a smart habit, especially as you approach the age when you’d like to start accessing your pension savings.

IF YOU WERE BORN AFTER 6 APRIL 1971, BUT BEFORE 6 APRIL 6 1973:

You have two options – carefully consider which one best suits your circumstances.

OPTION 1: ACCESS YOUR PENSION SAVINGS BEFORE THE DEADLINE

If you don’t want to wait until you’re 57 to access your pension savings, you’ll need to begin withdrawing funds between turning 55 and 6 April 2028. Remember that you can access your pension savings without taking large or regular amounts; you can decide what’s right for you. However, obtaining professional financial advice before making any decisions is essential.

Remember that leaving your pension savings invested longer allows for potential growth. Also, note that taking taxable money from your plan (anything exceeding your taxfree entitlement) may reduce the amount you can contribute to your plan due to the Money Purchase Annual Allowance.

OPTION 2: WAIT UNTIL YOU TURN 57

No action is needed if you weren’t planning to access your pension savings before age 57. You can access your pension savings at…

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A pension is a long-term investment not normally accessible until age 55 (57 from April 2028 unless the plan has a protected pension age).

The value of your investments (and any income from them) can go down as well as up, which would have an impact on the level of pension benefits available.

Your pension income could also be affected by the interest rates at the time you take your benefits.