/ Money

Give us early access to our state pension

Coins in clock

I advocated a more flexible approach to retirement in this month’s Which? Money magazine. Now, the International Longevity Centre has made the same call, suggesting early access to state pension for those who want it.

The thinktank wants the government to consider a ‘graduated’ state pension, where we’re able to receive part of our pension before we retire, allowing us to reduce our working hours.

On the face of it, this goes against recent trends. The minimum age you can claim state pension is going up each year for women and will rise for both men and women, from 65 to 66, in October 2020. After that it’s due to go up again, to 67 and then 68.

The age you retire should be a matter of choice

When the government abolished the default retirement age earlier this year, the Department for Work and Pensions said this meant ‘you should be able to retire when the time is right for you’. That’s great for those who don’t want to stop at 65, but what about those who do?

Not everyone fancies carrying on in full-time employment until they are that old, or even older. Some of us might prefer to work for a few days less, to semi-retire, to cultivate a hobby or downsize in readiness for full retirement. If you can’t draw your pension until you’re 66 or 67 these prospects seem pretty remote.

I think it would be fairer to make the state pension age negotiable. You can already put off claiming state pension and get interest on the money you’ve forgone, so why can’t you start drawing from it early as well, in exchange for receiving a little less?

After all, you only need to have made 30 years of National Insurance contributions to qualify for a full state pension, so many of us might feel we’ve already paid our due by the time we reach 55 or 60.

Early access could enable semi-retirement

Interestingly, the Longevity Centre’s study found widespread support for a relaxation of the rules. In fact, in it’s survey of 1,000 adults, over half said they supported the idea of a ‘graduated’ state pension.

Not everyone who favoured early access wanted to stop work altogether however, and the report suggests that ‘gradual retirement may be an important means by which individuals are able to work up to state pension age, rather than retiring early’.

Would you like early access to your state pension in order to semi-retire? Would you be willing to take a lower pension in order to be given this choice? And is the upward trend in pension age inevitable or should we be able to say when we retire?

Comments
diane O'Connell says:
7 March 2019

So we are made to work longer even though we have paid more than enough over the years to cover the pittance of your pension ,pensions in France Germany are higher than ours due to the money given by this country, and we also stop the young ones from getting jobs so we pay them dole money where’s the logic in that surely it would be better to give the young one jobs instead of encouraging them to claim benefits give them jobs encourage them to depart of society and let us old ones enjoy our hard earned retirement

We don’t pay into our own state pension. The NI contributions of those in work pay for those already drawing their pension; we have no personal pot. The problem is that when the state pension was first introduced to be drawn at 65, life expectancy was 66 for men and 71 for women. Now the expectancies are 77 and 82 so far more people are having to be paid out of the contributions of the existing workforce.

The way to retire early is to pay into a private pension. If you cannot afford that, or are not prepared to save in that way, during your working life then the only option is to work longer.