Monday, November 29, 2021

Savers have to wait two years longer to get access to the pension

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Most hard-working savers will not be able to retire until they are 57 years old, down from 55 now, due to changes that will take effect in April 2028

A large number of hard-working savers will not have access to their pensions for another two years, according to the proposals confirmed in the autumn budget.

The government said its Finance Bill 2021-22 would raise the earliest age most retirement savers can access their pension from 55 to 57 by 2028.

Anyone who draws on their pension before this age after the new regulations come into force is referred to by some as a “penalty tax” – the amount of which is not yet clear.

Financial experts have criticized the move, claiming it will affect thousands of people looking to retire early.

Nigel Borwell, co-founder of Local Financial Advice, said, “If this happens, the government needs to provide additional clarity and set the minimum retirement age the same for everyone regardless of the retirement plan so that retirees can save with confidence in the future.

Even if the age increase could disappoint many retirees, a longer investment window could mean greater financial security in the long term. “

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