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Planning for Later Life

Those reaching state pension age on or after 6 April this year will be eligible to receive the new state pension. This replaces the current system which consists of a basic state pension, which depending on individual circumstances may have been topped up by an additional pension amount.

When the new state pension was announced it was billed as being an easy to understand single payment. However, there has been widespread comment in the press about individual variations based on working history. Now the House of Commons Work and Pensions Select Committee which has been undertaking an enquiry into the new state pension has become “so concerned about misinterpretation attributable to confusing state pension statements” that it has issued an interim report.

In making its recommendations the Select Committee comments that “personalised statements are especially important in the complex interim period given the very wide range of personal circumstances which will result in different weekly pensions payable from different ages.”

The report therefore recommends a series of changes be immediately made to state pension statements in an attempt to make them clearer and to help people to better plan for their retirement.

Changes include:

highlighting key messages including the individual’s state pension age
the provision of clearer explanations in areas such as the calculation of any ‘contracting out deduction’
readily available supporting information such as national insurance payments history


If you require assistance with planning for income in retirement, please do not hesitate to contact the team at Beckworth who will be able to guide you through this complex area.