The state pension age may have to rise to 71 – when can you retire?

From round-the-world cruises to more time playing golf, there is plenty to look forward to when you retire but millions of people may have to wait longer to receive their state pension.

New research from the International Longevity Centre (ILC) has warned that a shrinking workforce – due to Britons' ill-health "long before they reach state pension age" – is hitting the tax base used to pay for pensions.

As a result, it suggests the UK’s state pension age would need to rise from 66 to 70 or 71 by 2040 "to maintain the status quo of the constant number of workers per state pensioner".

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Such a change would mean millions of middle-aged people "would face working an extra five years before they can access their state pension", said the Daily Mirror.

So, how much longer could you be waiting to get your state pension?

What is the state pension?

The state pension is a weekly payment from the government. It is paid once you reach state pension age, which is currently 66 for both men and women.

But the state pension age does not remain static, and further increases are already planned. Under the government's current schedule, the state pension age is set to rise to 67 between May 2026 and March 2028, and then to 68 from 2044. 

The full new state pension is currently worth £203.85 per week, but will increase to £221.20 from April 2024 based on the government's controversial triple lock calculations.

Last spring, an official review delayed a suggested accelerated increase in the state pension age, but "painted a stark picture of the massive burden on the public finances" as people live longer, said the Daily Mail. However, the latest report from the ILC has laid out "an even bleaker picture".

Why could the state pension age be raised?

The ILC has highlighted that a "stalling in life expectancy" during the austerity years and the pandemic has "temporarily eased" the pressure to increase the state pension age.

But it warns in its Healthy Ageing and Prevention Index that rising levels of ill-health and people leaving the workforce means the UK state pension age could need to rise to 71 "to maintain the status quo of the constant number of workers per state pensioner".

The Intergenerational Foundation, an independent think tank, agrees that the pension age should rise, said The Guardian. But there are questions about who should pay for it, especially as the younger generation "do not have the financial assets that their parents and grandparents did". 

The idea that everyone can just keep on working for ever is "completely unrealistic", said Suzanne Moore in The Telegraph, and many jobs are "not suitable for people in their 70s", including manual labour.

Making people wait longer for their state pension is "no quick-fix" either, said The Big Issue, and would require "investing in preventative healthcare".

Future pensioners would at least have time to prepare, said This Is Money, as the government is "meant to give people at least 10 years' notice of any change in the state pension age". 

However, people should not expect a change any time soon. Any increase would prove “incredibly unpopular” ahead of the general election, said Quilter's head of retirement policy, Jon Greer. 

But if you are worried, it could be worth increasing contributions to any private pension savings to "make sure that if you do end up having to wait longer to access your state pension then you have enough private pension wealth to bridge the gap".