The State Pension age in the UK is undergoing significant changes, with an increase from 66 to 67 set to commence next year and be fully implemented for all men and women across the UK by 2028. This adjustment to the official retirement age has been enshrined in legislation since 2014. Furthermore, a subsequent rise from 67 to 68 is scheduled to occur between 2044 and 2046, as mandated by the Pensions Act 2007.

The Pensions Act 2014 accelerated the increase in the State Pension age from 66 to 67 by eight years. It also reformed the phasing of this increase, ensuring that individuals born between March 6, 1961, and April 5, 1977, will become eligible to claim their State Pension upon reaching 67. The Department for Work and Pensions (DWP) will notify all affected individuals through a letter sent well in advance of these changes, underscoring the importance of understanding these shifts, especially for those with existing retirement plans.

Regular reviews of the State Pension age are a statutory requirement under the Pensions Act 2014, occurring at least once every five years. These reviews are fundamentally based on the principle that people should be able to spend a consistent proportion of their adult life drawing a State Pension. In light of this, the UK Government recently announced the formation of a new Pension Commission, which is tasked with investigating methods to boost pension saving. Its findings, expected to be published in 2027, will delve into areas such as auto-enrolment saving rates, strategies to enhance saving among groups like the self-employed, and a further review of the State Pension age itself.

As part of this comprehensive review, Dr. Suzy Morrissey will provide insights on factors the UK Government should consider regarding the State Pension age, while the Government Actuary’s Department will produce a report detailing the proportion of adult life spent in retirement. The review will rigorously assess life expectancy alongside a multitude of other pertinent factors. Any proposals for changes stemming from this review would then require parliamentary approval to become law.

For those planning their retirement, it is crucial to know their exact State Pension age, which marks the earliest point at which one can begin receiving their State Pension. This age may differ from the eligibility age for workplace or personal pensions. An accessible online tool on GOV.UK allows individuals of any age to check their State Pension age, Pension Credit qualifying age, and eligibility for free bus travel (at age 60 in Scotland), making it an essential resource for retirement planning.

Beyond understanding the eligibility age, individuals have opportunities to boost their State Pension payments. HM Revenue and Customs (HMRC) recently reported that over 10,000 payments, totaling £12.5 million, have been made through a new digital service launched last year, enabling people to enhance their State Pensions. However, those aiming to maximize their retirement income via contributory benefits face a critical deadline: only a few weeks remain to fill gaps in National Insurance (NI) records dating back to 2006.

Typically, voluntary contributions can only cover the past six tax years. However, an extension granted in 2023 by the previous government allows those affected by new State Pension transitional arrangements to pay voluntary NI contributions for tax years spanning from April 6, 2006, to April 5, 2018. This extended deadline, which concludes on April 5 of the current year, provides additional time for individuals to assess their situation and make contributions. After this date, the standard six-tax year limit will reapply.

Eligibility for making voluntary NI contributions to boost the New State Pension applies to men born after April 6, 1951, and women born after April 6, 1953. It is also important for individuals to ascertain if they are entitled to NI credits, which can fill gaps without requiring direct payment. Further information on making voluntary contributions and checking State Pension forecasts is available on GOV.UK.

Alice Haine, a personal finance analyst at Bestinvest by Evelyn Partners, emphasizes that typically, a minimum of 10 qualifying years of NI contributions is needed for any State Pension, and at least 35 years for the full new State Pension, though these years do not need to be consecutive. She advises carefully assessing the necessity of buying back missing years, considering future work plans and eligibility for NI tax credits that cover periods of sickness, unemployment, or time taken for family care.

Haine notes that plugging gaps has become more streamlined since the government introduced new NI payment services in April last year, alongside a State Pension forecast tool utilized by 3.7 million people. Users can log into their personal tax account or the HMRC app to view payment gaps and, if eligible, pay directly through digital channels. While calculating whether to top up can be complex, she cautions against paying for more years than necessary, as the money will not be refunded. She specifically highlights individuals who took career breaks, low earners, or expatriates as potential candidates for topping up their contributions. Given that this deadline has been extended multiple times previously, Ms. Haine strongly advises those considering action to initiate the process now, as the April cut-off is likely to be final.