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Pensions have gotten a lot simpler
Finding A Pension IFA
Changes to the State Pension
The state pension system is also experiencing a considerable shake-up.
The Pensions Act 2007, which became law on 25 July 2007, made changes which will, generally speaking, affect people who reach state pension age on or after 6 April 2010.
At the moment, the basic state pension is paid to women at age 60 and men at 65.
But from 6 April 2020, the state pension age for both men and women will be 65. In 2024, it will rise to 66, in 2034 it will be 67 and then in 2044 it will reach 68.
However if you were born before 6 April 1950, the changes won’t affect you.
These rises are in response to the fact that people are living much longer, and it is becoming a burden for the government to support pensioners from the age of 65.
While working longer may seem like bad news, the good news is that the number of years’ national insurance contributions people will need to achieve a full basic state pension will reduce to 30, for both men and women, from 2010. This is a significant reduction from the current requirement of 44 years for men and 39 years for women.
Another change is a plan to re-link the state pension with earnings, rather than inflation, in 2012.
Because earnings accelerate faster than inflation does each year, the state pension will become more generous.
The fourth big change for state pensions is the move of the state second pension to a simple flat rate. If you think this may affect you, seek professional advice from an experienced IFA.
Pensions Simplification and what it means to your pensions savings
Changes to the State Pension
Personal Accounts – the new workplace pension plan from 2012
