Categories
Finance

Retirement: Pension age changes coming which could impact retirement plans


Britons hoping to draw from their personal pensions may soon face a longer wait to access their cash. Upcoming changes to the Normal Minimum Pension Age (NMPA) could force people to change their plans.

What is the NMPA?

The NMPA is the minimum age at which most pension savers can access their pensions.

Anyone who draws from their pension before their NMPA could incur an unauthorised payment tax charge.

However, someone may be able to draw money from their pension early if they are doing so due to ill health.

READ MORE: Couple loses £77,000 in ‘devastating’ scam – Lloyds Bank issues warning

This follows the Government’s announcement in 2014 that the NMPA would rise.

The increase will be introduced to coincide with the rise of the state pension age.

In April 2028, the state pension age is scheduled to increase to age 67.

The NMPA was previously increased from age 50 to age 55 in 2010.

Those who would like to have taken a benefit but will now not be able to will also be affected by the changes.

Overall, people who had planned to draw from their pension in their 50’s, perhaps with a view to taking an early retirement, could be forced to wait an extra two years from April 2028.

Of course, there are many people who do not have enough of a retirement fund to retire early in any case, so they may not feel the effects of the changes.

However, members of the firefighters, police and armed forces public service schemes will not be included in the increase.



Source link

Leave a Reply

This site uses Akismet to reduce spam. Learn how your comment data is processed.