Retirement shocker as 70 becomes new state pension age

The likelihood is your life expectancy will have already improved in the few minutes in takes to read this article.

Better diet, health care and inflation are playing havoc with economic planning as people are living longer and benefitting from higher than planned increases in pension payments.

The need for taking steps to fund retirement is becoming more important every day – as the latest UK government figures show life expectancy is increasing every year.

State pension age is likely to retreat to 68 years old by 2027, according to calculations by the Office of National Statistics – and the magic 70th birthday is in sight as day to start collecting state pension.

In real terms, that means you can expect to live three months longer for every year that passes.

For retirement savers and the government increasing longevity is causing a big financial problem.

Until the new figures were released, the government was working on the state pension age hitting 68 in 2046 – now the estimate is 20 years earlier.

For UK pension savers, the future is shrouded in huge uncertainty as the government struggles to come to terms with how many billions are needed to fund the state pension.

Already, Chancellor George Osborne is wrestling with how to fund the government’s triple lock promise that cemented state pension rises at a maximum of 2.5 per cent or the annual rise of the consumer price index (CPI).

Currently, CPI is running at an unexpected 5.2 per cent and is expected to inch higher before falling.

One way to take control of a pension is open for ex pats – a QROPS offshore pension scheme.

Shifting UK pension funds in to a QROPS removes them from the problems of continually revising financial strategy in line with unexpected rule changes.