The UK retirement age can refer to the age at which you can access the state pension and a free bus pass. But there’s a different, lower age to keep in mind when accessing workplace or personal pensions.
If you’re self-employed, you might have workplace pensions if you’ve been employed before.
And as there’s no pension auto-enrolment for the self-employed, you might instead be saving for retirement using a personal pension.
What is the retirement age in the UK?
The UK no longer has a default state retirement age. The law was changed in 2011 to stop employers forcing people to retire at 65. You can continue working for as long as you want (or need) to.
Instead, there are pension ages, at which you can access a pension – including the state pension and other pensions you might have.
The average retirement age in the UK is 65 years old for men, while women leave work at an average of 64 years old, according to government figures from 2021.
What is the UK state pension age?
The state pension age is 66 years old.
This has increased in recent years, due to changing life expectancy. You don’t have to stop working when you reach state pension age.
The state pension age for both men and women is due to rise to 68 between 2044 and 2046 for anyone born on or after 5 April 1977. However, the state pension age is still under review, which means it could change again in the future.
Gov.uk has a state pension age calculator that you can use to work out your state pension age. All you need to do is enter your date of birth and it will tell you when you start claiming.
What is the retirement age for women?
It used to be that the retirement age for women, at which they could get the state pension, was 60.
It’s currently set at 66 for women, but is set to gradually increase from May 2026.
What is the retirement age for men?
The men’s retirement age in the UK, when they could start claiming a state pension, used to be 65.
It’s currently set at 66 for men, but is set to rise to 67 for anyone born on or after 5 April 1960.
How much is the state pension?
The full state pension amount is £221.20 a week.
Whether or not you get the full amount will depend on the number of years you’ve made National Insurance contributions. If you’ve paid National Insurance for anything less than 35 years, you might not receive the full state pension.
Meanwhile, the basic state pension amount (for those who reached state pension age before 2016) is £169.50.
Triple lock pensions
The state pension amount usually increases every year. It can increase by either 2.5 per cent, inflation, or earnings growth – depending on which is the highest figure.
This is known as the ‘triple lock’. Introduced in 2010, the triple lock is designed to make sure that the value of the state pension doesn’t decrease in real terms.
The 2024 Autumn Budget revealed that the basic and new state pension will both increase by 4.1 per cent from April 2025. They are increasing in line with earnings growth, which is the highest of the three triple lock measures this year.
Personal and workplace pensions
Under ‘pension freedom’ rules introduced by the government in 2015, you have more flexibility about how you access ‘defined contribution’ pensions when you reach 55 (increasing to 57 in 2028). This age is when you can access your personal pensions without getting an unauthorised payment tax charge.
Most modern workplace and personal pensions are defined contribution schemes, with the pension’s value determined by the money contributed, as well as investment performance over time.
When you reach this age, you can take 25 per cent of your pension tax-free, either as a lump sum or in separate smaller amounts. Then you can use the rest as you like – either by making more withdrawals (and paying income tax) or by buying an annuity.
An annuity is a product that gives you a guaranteed income for the rest of your life, depending on the size of your pension as well as other factors (like your age and health).
These pension freedom rules mean that it’s possible to access your pension while you’re still working.
When can I retire?
The retirement ages above are when you can access pensions – but if you want to ‘retire’, or simply stop working, there’s no set age.
For many people though, retiring means being able to stop working while still being financially secure, and a pension gives you that security.
It’s important that self-employed people think about when they’d like to retire. Having a particular age in mind is one of the first steps in retirement planning. That’s because if you’re 40 and you know you’d like to retire at 60, you can figure out how much to save for retirement.
The earlier you start saving the better, as you won’t need to contribute as much into your pension each month if you start earlier.
It’s worth taking professional retirement advice to help you understand your options.
chika_milan/stock.adobe.com
Retirement options for self-employed people
While some company owners may be able to sell their business to help fund retirement (this needs a detailed exit strategy), many self-employed people are their business. So, when they retire, the business likely won’t have much value.
It’s therefore important to use a pension, although self-employed people often find it difficult to save. According to the Institute of Fiscal Studies (IFS), only 20 per cent of self-employed people are saving into a private pension.
But paying into a pension gives you generous tax relief on your contributions. If you’re a basic-rate taxpayer, you can claim tax relief at the basic 20 per cent rate.
The government has made pension planning more of a priority in recent years. Here are some websites you can use to get free pension guidance:
- MoneyHelper
- Pension Wise (now part of MoneyHelper)
- The Pensions Regulator
- check an adviser’s authorisation through the Financial Conduct Authority (FCA)
You can also read our guide to self-employed pensions for more information about the different pensions available to self-employed people.
Useful guides for small businesses and the self-employed
- What’s the difference between a sole trader and a limited company?
- The best business bank accounts in the UK
- How to budget: a budget calculator and guide for the self-employed
- What type of business insurance do I need?
Looking for self-employed insurance?
With Simply Business you can build a single self employed insurance policy combining the covers that are relevant to you. Whether it’s public liability insurance, professional indemnity or whatever else you need, we’ll run you a quick quote online, and let you decide if we’re a good fit.
Rido/stock.adobe.com
This block is configured using JavaScript. A preview is not available in the editor.