State pension age increase 'encouraging' Britons to retire later in life

For 2024, the average age someone exits the workforce to retire has soared to the highest level since records began.

Britons are now retiring at around 65 and 64 years old for men and women, respectively.

As it stands, the age someone is able to access their full state pension is 66 but this is set to rise in the near future.

The age threshold will jump to 67 between 2026 and 2028.

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There have been calls to potentially bring forward the date at which the state pension age is raised in order to pay for the cost of the triple lock.

Concerns have been raised over the long-term viability of the retirement benefit's funding in the years to come.

A further review is expected to take place within two years of this Parliament to examine recommendations for an earlier increase to 68.

Alistair McQueen, the head of saving and retirement at Aviva, noted that the ever-changing state pension age is impacting how people approach retirement.

He explained: "The average age of exit from the labour market has hit a new high, since recent records began in 1984.

"The average age of exit for a man has risen to 65.7, from 65.3 years. The average age of exit for women has risen to 64.5, to 64.1 last year.

"Our retirement age is often linked to the age at which we can access the state pension.

"The state pension age has risen over recent years, to 66, and this has encouraged older ages of retirement.

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"In addition, since 2011, it has also been illegal to terminate someone’s employment due to their age, and since 2015 savers have been given greater freedom in how they can access their pension savings."

According to the retirement expert, the longer wait to retire has been beneficial in helping Britons boost their savings pot.

"These changes have supported a different approach to retirement," McQueen added.

"One of the most powerful levers we can pull to fund our longer lives in retirement is to work longer, with the potential for every extra year of work can add money to our retirement pot."