Experts have suggested a new Labour pension policy would allow Brits to access their retirement savings at any age.
People may soon be able to access their pension savings before they retire(Image: MoMo Productions via Getty Images)
Pension specialists have indicated that a forthcoming Labour retirement policy could enable Britons to tap into their pension funds regardless of age. The specialists suggest these fresh Labour proposals are anticipated to be revealed next week as part of efforts to combat retirement hardship across Britain and address the escalating expense of the state pension system.
Pete Glancy from Scottish Widows, alongside Mike Ambery from Standard Life, outlined these innovative Labour strategies to The Telegraph. The modifications would encompass permitting savers to withdraw a portion of their pension pot at any stage, potentially decades ahead of their planned retirement.
This emergency fund would amount to £1,000, according to the two specialists, reports the Express. Currently across the UK, pension access begins at 55 years old, though this threshold is scheduled to rise to 57 by 2028.
The Resolution Foundation had previously proposed a comparable adjustment during Torsten Bell’s tenure, who now serves as pensions minister. Glancy remarked: “We expect the second half of the pensions review to shortly be announced by the Government, and I think there’ll be a discussion on ‘Should we be helping people build up a rainy day savings pot alongside the retirement pot?'”.
He continued: “You’d be able to access the savings at any point. The idea is that if the pot gets above £1,000 because you haven’t needed to access it, it’ll tip over into the pension.
“We are supportive of that idea as it will keep many people out of the hands of unscrupulous lenders, and if the money isn’t ever needed for a rainy day, then it means a slightly bigger pension pot at retirement.”
We have a dedicated newsletter for ChronicleLive’s money-saving and cost of living stories. It’s free and you can sign up to receive it here. It will keep you up to date with all the latest money news and budgeting tips as well as stories on the cost of living crisis in our region.
Ambry elaborated: “The critical item will be the scope of the pensions review and its remit. Given the amount of time and change since the last commission-based review, it would be logical to recognise that the scope of pension and savings in today’s and tomorrow’s world might be wider.
“As a result, the review could include accessing pensions early through emergency savings,” he continued. The Resolution Foundation previously urged that savers should be permitted to withdraw up to 20 per cent or £15,000 from their retirement funds, with repayment required at a subsequent stage through enhanced contributions.
Labour included a pensions overhaul in its electoral pledges, emphasising enhanced financial stability for those in retirement.
ChronicleLive has created a dedicated WhatsApp community for shopping, deals and bargains. You can join this WhatsApp community here. It will keep you up-to-date with shopping trends and bargain buys, sent directly to your phone.