Is Personal Pension Retirement Age Linked to State Pension Age?

Last updated on December 4th, 2015

So if you are wondering if personal pension retirement age is linked to State Pension Age then the short answer is possibly! In the past it was possible to take your personal pension at age 50 but this was in the days when the State Pension Age for women was 60 and for men was 65.

The retirement age for personal pensions was then increased to 55 in April 2010. At that time, and since, the government has said that it wants a correlation between the retirement age for personal pensions and the State Pension Age. Currently the policy is for the difference to be 10 years. This therefore begs the question as to is that 10 year age gap going to continue? The idea is that it will continue, and if anything it may get smaller, possibly even a gap of 5 years. However, there is no actual legislation in place to make this change so at the moment it is still really speculation.

So with State Pension Age increasing over the coming years, can we expect that the minimum age for taking your personal pension will increase above 55 soon? Even those within 10 years of thinking they may be able to have access to their personal pension, may have to wait a few years longer. For example if you are 48 now, you may expect that in 7 years time you can access your personal pension funds, whereas, because your State Pension age will be 67, it is quite feasible that you may not be able to access your personal pension until age 57.

There has been talk, as mentioned, that the difference between the private pension retirement age and State Pension Age will be reduced to 5 years in future, this means that people will have to wait even longer to be able to access their pension pots and for a lot of people this could be as late as age 65 if the State Pension Age is increased to 70 in the future as expected.

So at the moment it is a little bit up in the air, but it might be worth having contingency plans in place just in case you can’t get access to your personal pension as soon as you might think.