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Many Britons will be looking forward to the day they can leave their working lives behind to retire, often with specific goals for later life. However, the state pension age is not the only milestone people will need to look out for when it comes to retirement.
Britons will also need to consider what is known as the normal minimum pension age (NMPA), which is perhaps less well known.
The NMPA outlines the point at which individuals are permitted to access money from their pension.
People can do so earlier, but face a massive tax charge, or the threat of a scam with this action.
At present, the NMPA is 55, but from April 6, 2028, this is set to rise to 57 and older – aligning with the intended rise to the state pension age.
READ MORE: Britons given more time to boost state pension
However, experts have suggested the NMPA rise should be “abolished” altogether.
Jon Greer, head of retirement policy at Quilter, said: “The Government should look to abolish plans to increase the Normal Minimum Pension Age.
“In 2014, the coalition Government announced it would increase the NMPA from 55 to 57, deeming it appropriate for the NMPA to be set 10 years below the state pension age.
“In February 2021, the Government announced it would increase the NMPA to 57 in 2028 and provided details of a protection regime.
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As Mr Greer identified, there are still some circumstances where Britons will be able to access their money early.
This, for example, includes those who are suffering from serious ill health, or individuals with a protected pension age.
However, the expert went on to state such a change is unlikely to create a positive difference.
Mr Greer continued: “Restricting access to pension savings for an extra two years isn’t likely to change their behaviour and will do very little for their future retirement prosperity.
“This is since only a very small proportion of customers access their pension at the earliest age and those that do at the earliest age are unlikely to be sustained by their pension pot till they die.
“However, it will dramatically complicate the retirement planning process and would add unnecessary complexity to the pension landscape.”
A Government spokesperson previously told Express.co.uk: “We announced the change in the normal minimum pension age to 57 in 2014, 14 years in advance of the change to give people time to make financial plans.
“We are revolutionising how consumers keep track of their pension information by introducing pensions dashboards – a single online place for people to access via their digital device at any time, putting the saver more in control and transforming how they think and plan for their retirement.”
