Normal Minimum Pension Age 55 to 57 Transfers Now Blocked

Published / Last Updated on 05/11/2021

Many will be aware that the Normal Minimum Pension Age (NMPA) of age 55 is being increased to age 57 in April 2028.  This reflects that State Pension Age will have increased by then to age 67 and it is a given standard that the Government wants NMPA to be 10 years before State Pension Age.

If you were born before the 6th April 1971, this will not affect you as you will have already passed Age 55 and can draw your pension early, you will also be 57 before the changes start.  If you were born after this date then you will be affected.  There is a transition period for those born between 6th April 1971 and 5th April 1973.

In February 2021, the government confirmed that if you would be affected and you had a pension scheme already with a retirement age set at 55 (even if this is after 5th April 1971), the 55 retirement age will be protected.  In addition, you would be allowed to transfer other pensions e.g. retirement age 60 pension transfer to your age 55 pension provided this was done 5th April 2023.

On the 4th November 2021, the Treasury announced that with effect Midnight on 3rd November 2021, any transfers after that date will NOT secure the Age 55 protection.  In short, the window for transfers to protected Age 55 schemes has been closed.

This followed intense lobbying from the pensions industry that

  1. It may create a stampede of people transferring ‘good’ pensions to ‘poorer’ pensions just to secure  and protect age 55.
  2. People may leave their workplace pensions unnecessarily and lose their employer pension contributions.
  3. The systems development costs burden on pension providers to ‘ring fence’ pensions with an NMPA of 55 with those at with an NMPA 57.

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