Retirees concerned about the possibility of the Department for Work and Pensions (DWP) state pension age change being brought forward could bridge the gap for around £75 a month. For those currently aged 49, setting aside just over £50 monthly after tax relief could generate enough savings to cover an additional year without state pension income. Millions of people face working for an extra year to claim their state pension under plans to bring forward a rise in the retirement age.
Details of the Proposed Change
The state pension age is legislated to increase to 68 between April 2044 and 2046, affecting anyone born after April 5, 1977. However, the Treasury told the Office for Budget Responsibility (OBR), the Labour Party government's spending watchdog, that its “current policy position” was to bring the timeline forward by seven years to 2037-39.
The £50 monthly figure applies specifically to 49-year-olds and is designed to replace just one year of projected state pension income during the additional waiting period, not to substitute for lifetime payments. Someone aged 55 would need to contribute approximately £75 a month to achieve the same outcome.
Expert Advice on Retirement Planning
Adam Cole, retirement specialist at Quilter, said: “Rather than relying solely on government provision, individuals should view developments like this as a reminder of the importance of building their own retirement savings.” He added: “While no one welcomes changes to the goalposts, these examples highlight the power of starting early. Small, regular pension contributions, combined with tax relief and investment growth over time, can provide valuable flexibility and help reduce dependence on an increasingly stretched state pension system.”
“For many people, the best defence against that uncertainty is to take greater ownership of their retirement planning today,” he said.
Government Response
A Treasury spokesman said: “This is not new information. The previous government publicly committed to raising the state pension age to 68 between 2037 and 2039, and the OBR has reflected that position for years. The state pension age review, which will consider what the timetable for state pension age should be in the coming decades, is currently underway and we cannot pre-empt the outcome.”
