The NMPA is changing soon
On 6 April 2028, the NMPA will increase from age 55 to age 57. So, from 6 April 2028 you’ll need to be aged 57 or older before you can access your pension (if you intend to take your benefits early).
What the NMPA Means for You
Currently, you must be aged 55 or over to start taking money from your pension. This is called the Normal Minimum Pension Age (NMPA) and it’s set by the Government.
The NMPA is not the same as your scheme’s Normal Retirement Age (NRA), which is typically the age you can take your pension from the Scheme without any reduction for early payment or requiring consent from the Trustees or your employer. These requirements will be specified in the pension scheme rules.
There are still some circumstances where you might be eligible to take retirement before age 57, for example if you are suffering from ill health or have a protected pension age.
What it means for different members
Born on or before 6 April 1971:No impact because you will already have reached age 57 by 6 April 2028.
Born between 6 April 1971 and 5 April 1973: You have a window from your 55th birthday and 5 April 2028 to access your pension savings before the NMPA increases to 57. If you choose not to take any pension savings during this period, you will not be able to access your pension until at least your 57th birthday.
Born after 5 April 1973: If you were born after 5 April 1973, the earliest you can access your pension will now be age 57. This change means you may need to review your financial plans if you had previously planned on taking early retirement, considering options such as working longer, adjusting your savings, and refining your long-term financial strategy.
Options for members who were born after 6 April 1971 but before 6 April 1973
Option 1: Access your pension savings before the window closes
If you do not want to have to wait until you’re at least 57 , to start taking your pension savings, you’ll need to start to access your money after you turn 55, but before 6 April 2028.
If you’re thinking about accessing your savings, we recommend speaking to a financial adviser first. If you do not have an adviser, you can find one through MoneyHelper, the free government backed service providing guidance and information to make effective financial decisions.
Option 2: Wait until you turn 57
You can choose to wait. If you were not planning to access your pension savings before age 57, then you do not need to do anything. You’ll be able to access your pension savings at any age from 57 onwards (subject to any restrictions in Scheme rules).
Protected Pension Age (PPA)
A Protected Pension Age (PPA) is a special provision that allows some pension scheme members to access their pension benefits earlier than the standard Normal Minimum Pension Age (NMPA).
To be eligible for a PPA, you must meet very specific criteria:
- Pension scheme rules must have definitively granted an unconditional right to take benefits before age 57, with this specific right unequivocally existing on or before 11 February 2021. Furthermore, you must have been an established member of the scheme before 4 November 2021 to qualify for potential PPA consideration.
- Some members may have a protected pension age of 50 if they accrued pension savings in the scheme before 6 April 2006 and in there is an unqualified right in the scheme rules at 10 December 2003. If you have a protected pension age of 50 in the scheme this is not replaced by subsequent changes to NMPA.
What Makes a Right ‘Unqualified’?
This means you can access your pension without requiring consent or approval from employer or trustees. The right must be explicitly and unambiguously stated within your scheme’s rules, leaving no room for interpretation or discretionary intervention. To determine if this applies to your pension scheme, please contact Isio administration.
Pension Transfers and PPA
When considering transferring your existing pension to a personal pension or new employer’s scheme, it’s important to consider if you have a Protected Pension Age (PPA) in the Scheme, how this is affected if you transfer. Typically, your PPA can be transferred with your pension. However, not all pension schemes receiving a transfer will preserve this protected retirement age. It’s essential to confirm with your new scheme, before accepting the transfer, whether they will accept a PPA for the transferred benefits.
Guidance and help finding a FCA regulated advisor
MoneyHelper
MoneyHelper is a free government backed service designed to ensure that people throughout the UK have guidance and access to the information they need to make effective financial decisions over their lifetime.
They provide in-depth guides to help improve your finances, tools and calculators to help you track and plan ahead and offer free support and guidance over the phone and online.
Phone (UK)
Phone (Overseas)
Web enquiry
www.moneyhelper.org.uk/en/contact-us/pensions-guidance-enquiry-form.html
Website
Independent financial advice
Independent financial advisers (IFAs) are the only type of financial advisers who can choose from all the products available in the marketplace – making sure you get the right product for your needs. Financial advice is when someone has studied your personal circumstances and assesses and recommends financial products that are suitable for you.
You should use an adviser who is registered with the Financial Conduct Authority (FCA). MoneyHelper maintain a directory of IFAs who give retirement advice.
Website
www.moneyhelper.org.uk/en/pensions-and-retirement/taking-your-pension/find-a-retirement-adviser
You may already have been approached by a financial adviser. Please be aware that pension scammers sometimes pose as financial advisers; have smart-looking brochures and websites giving scam warnings, pretending to be official or government backed. Professional appearances do not guarantee that a company can be trusted. You should check with the FCA to make sure a firm is authorised before acting on any pensions advice they’ve given. You can check this on the FCA website.
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