The age at which you could claim your state pension benefits had for many years been 65 for men and 60 for women. But the previous Labour government set out plans, based on recommendations from Lord Turner, to steadily increase the state pension age to 68 for both men and women over the next four decades.
The Labour government’s policy had been to raise the state pension age to 66 by 2026 and then incrementally to 68 by 2046. Retirement was due to equalise for men and women at 65 by 2020, rise to 66 between 2024 and 2026, 67 between 2034 and 2036, and 68 between 2044 and 2046.
In May last year, the new coalition government initially signalled its intent to speed up the process, bringing forward the first rise to 66 for men from 2026 to 2016. In the end, the Comprehensive Spending Review in October 2010 settled on a less radical option, confirming that the rise to 66 for both men and women would come by 2020.
The government has said it will have to raise the state pension age even higher in following years, which could see many Britons working today waiting until age 68 or even 70 before they receive their state pension. It had been expected that the women’s state pension age would rise to 65 by 2020. It will now move to 65 by 2018 and then be hiked to 66 (same as men) by 2020.
Decisions, decisions, decisions
When you reach the state pension age, you essentially have three choices:
– Cease your working life and get your state pension
– Continue to work and receive your state pension as well
– Carry on working and hold off claiming your state pension
If you postpone claiming your state pension, you may receive an extra state pension when you do finally decide to claim it. And you can put off taking it for as long as you like.
When you do eventually decide to take your state pension, you can choose to receive either the extra state pension for the rest of your life, or receive a one-off, taxable lump-sum payment, equivalent to the benefits you put off claiming plus interest, as well as your regular weekly state pension. In addition, you can choose to stop claiming it after having claimed it for a period.
