Quick answer
The minimum pension access age
The minimum pension access age is the earliest age at which you can access your pension benefits. It is currently 55 for most people. This applies to both defined contribution and defined benefit pensions, though defined benefit schemes may have their own normal retirement age that is different from the minimum access age.
The minimum access age is separate from the state pension age (currently 66). You can access your workplace pension up to 11 years before you become entitled to the state pension, if you choose to.
The 2028 change
The minimum pension access age is rising from 55 to 57 in April 2028. This means that if you are currently under 55, you will need to wait until you are 57 before you can access your pension (unless you have a protected pension age).
Some pension scheme members have a protected pension age, a right to access their pension before the standard minimum age, protected from the 2028 increase. This typically applies to members of certain occupational schemes (such as firefighters, police and armed forces) and some individuals who had a right to take their pension at 50 under older rules.
If you are planning to retire between 55 and 57 and were born after April 1973, the 2028 change may affect your plans. It is worth checking whether you have a protected pension age and planning accordingly.
Do you have to stop working?
No. You can access your pension while still working. Since 2015, pension freedoms legislation has removed the requirement to stop working before accessing a defined contribution pension. Many people choose to take some pension income while continuing to work part-time, a form of phased retirement.
However, if you are still contributing to a workplace pension and you access your pension flexibly (for example, through drawdown), your annual allowance for future contributions may be reduced to £10,000 (the money purchase annual allowance). This is an important consideration if you plan to continue saving into a pension after accessing it.
Steve's observation
The flexibility introduced by pension freedoms in 2015 is genuinely valuable, but it comes with responsibility. The ability to access your pension from 55 does not mean it is always a good idea to do so.
Every year you delay taking your pension is another year of investment growth and another year of contributions. For many people, the right answer is to delay pension access as long as possible, particularly if they are still working and have other income to live on. The difference between taking your pension at 55 and 65 can be enormous.
Defined benefit pension access
Defined benefit pensions have a normal retirement age set by the scheme, often 60 or 65. You can usually take the pension early (from the minimum access age), but it will be reduced to reflect the longer payment period. The reduction is typically around 4–6% per year of early access.
Taking a defined benefit pension late, after the normal retirement age, may result in a higher income. Check your scheme rules to understand the terms for early and late retirement.
Early access, the risks
Accessing your pension before the minimum age is not possible in normal circumstances. The only exceptions are serious ill health and certain protected rights. Any scheme that claims to allow early access to your pension, particularly through a transfer, is almost certainly a scam.
Pension liberation fraud, where fraudsters persuade people to transfer their pension to a scheme that claims to allow early access, is a serious and growing problem. If you are approached about accessing your pension early, be extremely cautious and check the FCA register before proceeding.
Planning your retirement timing
The timing of when you access your pension has a significant impact on the income you receive. Accessing it earlier means a smaller pot and a longer period over which it needs to last. Accessing it later means a larger pot and a shorter period.
When planning your retirement timing, consider your health, your other income sources, your expenditure needs and your state pension entitlement. A financial adviser can help you model different scenarios and understand the trade-offs involved.
Pause for thought
- Do you know when you plan to retire and whether your pension pot will be sufficient at that age?
- If you were born after April 1973, are you aware that the minimum pension access age is rising to 57 in 2028?
- Do you have a protected pension age that might allow you to access your pension before 57?
- Have you considered the impact of the money purchase annual allowance if you plan to access your pension while still working?
Coaching point
Key terms
Frequently asked questions
What to do next
Think about when you plan to retire and whether your current pension savings are on track to support that plan. Guide 16 explains the retirement options available to you when you do come to access your pension.