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If you’ve recently reached your fifties and are counting down the years until you can access your pension, there’s an important rule change on the horizon that you need to be aware of.
The earliest age you’ll be able to access your pension savings without facing an additional tax charge will increase from 55 to 57 in less than two years’ time, so if you’re planning to start taking money out of your pension from age 55, you may need to rethink your retirement plans.
The ‘Normal Minimum Pension Age’ (NMPA), the official name for the age at which you can start taking money out of most private pensions, goes up on 6 April 2028, at the start of the 2028/29 tax year. The last time the NMPA changed was 16 years ago in 2010, when the minimum age increased from 50 to 55.
People who were already aged 55 before 6 April 2026 are generally unaffected by the increase, but those approaching 55 in the next couple of years need to understand how the transitional rules could affect them.
Gary Smith, Partner in Financial Planning and retirement specialist at wealth management firm Evelyn Partners, said: “This seemingly straightforward rule change could catch out thousands of unsuspecting pension savers. Many face a cliff-edge, where their ability to access their pension is suddenly put back for up to two years.
“All savers in their early fifties need to be aware of how their age might mean they need to rethink retirement plans because their access to pension funds is either compromised or delayed.”
Here, we explain what the change to the pension access age could mean for you and whether there’s any way to mitigate the impact of the increase to 57.
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If you’re considering seeking professional financial advice on the options available to you, we’ve partnered with nationwide Chartered independent advice firm Fidelius to offer Rest Less members a free initial consultation with a qualified financial adviser. There’s no obligation, however if the adviser feels you’d benefit from paid financial advice, they’ll talk you through how that works and the charges involved.
Fidelius are rated 4.7 out of 5 from over 2,600 reviews on VouchedFor, the review site for financial advisers.
Why is the age at which you can access your pension changing?
The change in the pension access age reflects the fact that we’re generally living longer than previous generations, meaning many of us will spend two or three decades in retirement. This means that our pension savings often need to stretch much further than they once did. The increase in pension access age to 57 means that most people will need to remain in work and continue contributing to their pension for longer, giving their retirement savings an extra boost.
The government also wants to keep the minimum pension access age roughly 10 years below the State Pension age. The State Pension age is increasing to 67 between 2026 and 2028, so the minimum age for accessing most private pensions is rising in line with it.
Who will the change affect?
The change will apply to most people who haven’t reached age 57 by 6 April 2028.
If you were planning to dip into your pension at 55 to retire early, cut back your working hours, pay off your mortgage or bridge the gap until your State Pension begins, you may need to rethink your plans, as you’ll need to wait an extra two years before you can access your pension savings without facing an unauthorised tax charge.
However, there may be steps you can take now to give yourself more flexibility. For example, if you’re still hoping to stop work at 55, you could build up savings in an ISA that can be accessed at any age. Having money outside your pension could provide you with a useful source of income if you need it before you reach the age of 57.
Are there any exceptions?
Yes, although the increase to the minimum pension access age will apply to most people, there are a few exceptions. These include:
1) If you have a protected pension age
Some pension schemes give members a protected pension age, which means they can still access their pension from age 55, even after the minimum age rises to 57 in April 2028.
This protection typically applies to people who belonged to certain pension schemes before the rules changed, although strict conditions may apply. Not everyone with an older pension will qualify, so it’s worth checking with your pension provider if you think you might be eligible. If you have a protected pension age, you may have greater flexibility over when you retire or start drawing an income from your pension.
Mr Smith said: “A protected pension age is scheme specific, not to the individual, and some pensions might have one and others might not, so if you contact the scheme they will be able to confirm if a protected retirement age is in place. There are some schemes that still retain a protected retirement age of 50 (or earlier in some instances) from when the last increase in the minimum pension age was implemented in April 2010.
“If you do have a protected pension age, you must be careful as these can be lost in certain circumstances, mainly if you transfer them to another arrangement. If you are considering transferring your pension into another arrangement, it is imperative that you clarify if the transferring scheme has a protected age, and that this won’t be lost on transfer out.”
You can find out more about transferring pensions in our guide Should I transfer my pension?
2) If you're a member of certain public service pension schemes
The increase to age 57 won’t affect members of some public service pension schemes, including those for the armed forces, police and firefighters.
These schemes have their own retirement rules that recognise the physical demands of these professions, so members can often take their pension earlier than people saving into most workplace or personal pensions. You can find out more about public sector pensions in our guide How do public sector pensions work?
3) If you're forced to retire because of ill health
If you’re unable to continue working because of serious ill health, you may be able to access your pension before the normal minimum pension age.
Exactly how this works will depend on your pension scheme’s rules, but you’ll usually need medical evidence to show that your health prevents you from working. Some schemes have specific criteria that must be met before they’ll agree to release your pension early, so it’s important to speak to your provider if you think this might apply to you. Learn more in our article Can I retire early because of illness or disability?
Why the timing of your 55th birthday matters
If you reach the age of 55 between 6 April 2026 and 5 April 2028, before the rules change, you fall into a small group that could be affected differently from everyone else.
This is because you may be able to keep the option of accessing your pension from age 55 due to reaching 55 before the minimum pension age rises. However, you’ll only be able to do so if you start taking benefits from your pension before 6 April 2028.
If you don’t access your pension before the new rules come into effect, you’ll generally need to wait until you’re 57 before you can start taking money from your retirement savings without facing an additional tax charge.
For example, if your 55th birthday is in March 2028 but you decide not to take any pension benefits before the rules change a few weeks later, you’d normally have to wait until your 57th birthday before you could access your pension.
This doesn’t mean you should rush to take money from your pension simply to beat the deadline. For many people, keeping their pension invested for longer may be the better option. However, if you were planning to use your pension between the ages of 55 and 57, it’s important to understand how the changes could affect your plans and explore your options sooner rather than later.
It’s worth bearing in mind too that these transitional rules are complicated and exactly how they apply will depend on how you access your pension and the type of pension you have. If you think you could be affected, check with your pension provider or consider seeking professional financial advice before taking any action.
A final thought…
If you think you could be affected by the increase, it’s worth taking some time to review your options.
A good starting point is to check when you can access each of your pensions, as different schemes may have different rules. You should also find out whether you have a protected pension age, as this could allow you to access your pension earlier.
If you want the flexibility to retire before age 57, consider building up other savings, such as ISAs, which can be accessed at any time.
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If you’re considering seeking professional financial advice on the options available to you, we’ve partnered with nationwide Chartered independent advice firm Fidelius to offer Rest Less members a free initial consultation with a qualified financial adviser. There’s no obligation, however if the adviser feels you’d benefit from paid financial advice, they’ll talk you through how that works and the charges involved.
Fidelius are rated 4.7 out of 5 from over 2,600 reviews on VouchedFor, the review site for financial advisers.
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