THE BACKGROUND
The state pension age is rising. And it's happening at breakneck speed.

For donkey's years, the age at which you can claim your state pension benefits has been 65 for men and 60 for women.

But huge jumps in life expectancy have seen costs shoot up for the Treasury, which is paying some pensioners for more years in retirement than they spent paying National Insurance as workers.

The previous Labour government set out plans, based on recommendations from Lord Turner, to steadily increase the state pension age to 68 for both men and women over the next four decades.

For many years, the state pension age for men was 65 and the state pension age for women was 60. But from 2020, both men and women's state pension age will be 66, increasing to 67 between 2026 and 2028, and then linked to life expectancy after that. 

The government will then review the state pension age every five years. 

This will see those in their early 20s now have to wait until they're at least 70 before they can take their state pension.

WHO CAN GET A PENSION? 

Not everyone is entitled to the full state pension - which is a regular payment from the government. Eligibility depends on you meeting a certain criteria.

As well as being the required age, you must work in the UK and have made National Insurance contributions for 30 years, pay voluntary National Insurance or be credited with them from the government.

According to HMRC, the basic rate increases every year, by whichever is the highest:

• Earnings - the average percentage growth in UK wages

• Prices - the percentage growth in prices in the UK as measured by the Consumer Prices Index

• Or 2.5 per cent.

You might also qualify for the additional state pension or, if pension credit, if you’re on a low income.

WHEN CAN YOU GET YOUR STATE PENSION? 

The exact date that you get your state pension will depend on the year you were born. You can work this out using the State Pension Calculator, and also by referring to the Department for Work and Pensions tables below. 

Since 2010 the state pension age for women has been changing to bring it in line with the male age of 65.

By April 6 2016 the retirement age for women will have risen to 63.

Moving up: By April 6 2016 the state pension age for women will be around 63

It had been expected that the women's state pension age would rise to 65 by 2020.

This provoked anger among around 500,000 women in their fifties who would have had to work up to two years longer.

The worst-hit 33,000 would have to wait two years. Some were in line to lose up to ￡15,000.

But the Government has offered them a reprieve. It said the maximum wait would be eighteen months rather than two years. It will achieve this by moving back the date at which the pension age hits 66 from April to October 2020.

Then between April 2016 and December 2018 it will rise to 65 for women.

Changes: Women will see the state pension age move to 65 by 2018

After this, between December 2018 and October 2020, the retirement age for both men and women will rise to 66.

Increases: By 2020 the state pension age will be 66 for both men and women

From 2026 to 2028 the state pension age for both men and women will start rising to 67.

Rises: Both men and women will see the state pension age rise to 67 towards the end of the next decade

After this, the government will review the state pension age every five years based on life expectancy. There is more about this below.

The government is already planning to review the state pension age in 2017. Any changes  would not affect the timetables for moving the state pension age to 65 or to 66 or 67, but it could mean changes for people older than that. 

In the Chancellor's 2013 Autumn Statement, he said future generations should spent up to a third of their adult life in retirement. Based on this, the DWP has produced indicative tables on how the state pension could move from 77 to 78 from the mid 2030s and to 69 in the late 2040s. This could all change though once the government starts reviewing and linking the state pension to life expectancy.  

Above 67: This table gives only indicative dates as it depends if the government has made any changes

THE FUTURE: Moving retirement above 67

Pension age liked to life expectancy

If the pension age rose from now in line with the change in life expectancy over the past three decades (since 1981), someone born in 1970 could be forced to wait until 71.

An initial target of 70 is pencilled for the 2060s, but if life expectancy and improving mortality rates continue at their current levels (a 5.3 year rise in longevity since 1981), the state pension age could hit 77 by the mid 2070s. This means an A-Level student in 2013 might face a 60-year working career before he or she can retire.

Any changes will be implemented over a long time period, but the implications of linking the pension age to life expectancy are clear: we will all be working much longer.

Could it be a 'seven-year itch'?

Before you sink into deep depression - we must add that it's unlikely to move as fast as all that. The rises would almost certainly be seen as too thick and fast - political suicide for a government of any colour.

A more realistic theory is that the state pension age will now rise one year every seven. Today's 40-somethings could see the pension age hit 68 by the time they retire if successive governments keep jacking it up at current rates.

The state pension age hike to 67 – now scheduled to start in 2026 – will come seven years after it starts to rise to 66. This would produce a scenario similar to the timeline shown below.

Future rises: A potential timetable for future pension ages rises put together by Standard Life - click to enlarge

Your choices at state pension age

When you reach the milestone of the state pension age, you essentially have three choices.

? Cease your working life and get your state pension

? Continue to work and receive your state pension as well

? Carry on working and hold off claiming your state pension

In regards to the final option, if you postpone claiming your state pension, you may get extra state pension when you do finally decide to claim it. And you can put off taking it for as long as you like.

When you do eventually decide to take your state pension, you can choose to receive either extra state pension for the rest of your life, or receive a one-off, taxable lump-sum payment, equivalent to the benefits you put off claiming plus interest - as well as your regular weekly state pension.

In addition, you can also choose to stop claiming it after having claimed it for a period. And remember, if you carry on working after state pension age, you don't have to carry on paying National Insurance contributions (NICs).

(Source:Daily Mail)