It‘s reasonable to conclude that when it comes to state pensions, women have been dealt a pretty lousy hand, and not just recently either.
Between 2010 and 2018, the state pension age for women rose from 60 to 65, a decision justified on the rather tenuous grounds that it ‘streamlined’ pension provision in one fell swoop, so matching the age at which men received their payouts. Many women were unhappy with this arrangement, claiming that they had not been notified soon enough of the change in legislation; the outcry resulted in the establishment of Women Against State Pension Inequality (WASPI), the body which led the campaign for compensation.
Essentially, WASPI urged the government to implement fairer transitional state pension arrangements for all women born on or after 6 April 1950 who, they said, had unfairly borne the burden of the increase to the state pension age without appropriate notification.
As the WASPI website notes: “Women had as little as one year’s notice of up to a 6 year increase to their state pension age, compared to men who received 6 years’ notice of a one year rise to their state pension age.”
Since 2018, the retirement age for both genders has risen to 66; this is expected to rise to 67 at some point over the next three years.
Additional bad news is on the horizon. Following the Government’s recent decision to initiate a review into the official pension age, it looks almost certain that there will be a further increase, to age 68, much sooner than anticipated. Initially, this rise had been pencilled in for the mid-2040s, although it now looks as though this will happen in the early 2030s.
Last month, when the pension age review was launched, the Institute for Fiscal Studies (IFS) reported that women would ‘be hit hardest’, financially speaking, should the planned increase in the state pension age be brought forward to 68, possibly in less than five years. Such an anomaly would emerge primarily because women are less likely to be in work in their late 50s and early 60s. The IFS maintain that making women wait longer to receive their state pension could result in them incurring an unexpected financial burden.
Speculation surrounding a speedier increase in the state pension age comes as the Government desperately tries to rein in its spending, particularly on retirees.
Governments of every hue have developed a habit of focusing their attention on older folks at this time of the year following the publication of wage and inflation data, two elements which determine the level of pensions from April 2026. Yes, it’s time once again for us to debate the ‘triple lock’, the rule by which the increase in next year’s state pension is established (the new rate is the highest of inflation, average wages or 2.5%). At present, economists suggest that next year’s full state pension will increase by £560 per annum, lifting the total pension to £12,536 from April 2026.
Although the latest ‘official’ annual inflation figure of 3.8% looks little more than a bad joke, next year’s projected pension increase creates a further headache for Chancellor Rachel Reeves, as she must contend with the cost of other pensioner-related state benefits, including the winter fuel allowance, pension credit and housing benefit. The Office for Budget Responsibility forecasts that the aggregate cost will be £158 billion this year, rising to £182 billion within five years.
It would be foolish in the extreme to ignore the fact that plans to reduce the scale of these enormous outgoings will be addressed sooner rather than later. Moreover, existing retirees and those on the cusp of retirement can offer only disjointed opposition to government plans; let’s face it, pensioners are unlikely to take to the streets in their thousands, waving flags bearing defiant messages or gluing themselves to zebra crossings.
Meanwhile, income taxes will almost certainly rise. The maximum state pension of £12,536 from April 2026 is only £34 less than the Personal Allowance threshold (of £12,570), meaning that pensioners with even modest incomes will find themselves paying income tax. Furthermore, as the Personal Allowance threshold is frozen until at least 2028, pensioners’ tax bills will continue to rise.
Given the attacks on their income, millions of older people are facing an unexpected financial dilemma; a sizeable number of them have done something about it.
Back in May, I wrote here that, “… a well-known insurance company reported that more than half (52%) of [the company’s survey participants] aged over 50 were concerned about the potential lack of a guaranteed retirement income.”
I added that, “Irrespective of how much capital you have, or how successfully you may have invested over the years, your pension pot / investment portfolio will produce a finite level of income. It follows that when contemplating how much money you wish to withdraw from your savings as income, you must also consider how long it will last.”
The answer to the obvious question arising from this statement, ‘how do you know when your turn to shuffle off this mortal coil has arrived, is, “We don’t .”
Back in Spring, I noted that “…the survey confirmed that a good-sized number of people have recently taken decisive action to address their longer-term income-related concerns.”
During the first quarter of 2025, thousands of people joined them, releasing equity from their homes, generating tax free funds to spend as they like. In July, the Equity Release Council was even more specific, noting that, “Older homeowners unlocked £636 million in property wealth [during the second quarter of 2025], with funds distributed to 14,404 new and returning customers.”
Nor is there any need to take the funds in a single lump sum; the option also exists to draw the tax-free funds as a regular payment, effectively boosting your monthly disposable income and, as a consequence, improving your retirement lifestyle. This is called a drawdown equity release plan. Significantly, given the widely anticipated onslaught on pension income, this ‘regular drawdown’ remains tax-free.
As the evidence shows, while equity release plans are available only to those aged 55 and over (some from age 50), so far this year, around 30,000 people have withdrawn a percentage of their ‘bricks-and-mortar wealth’ which they can legitimately keep at arm’s length from the taxman.
Those who are conscious that their retirement income could require an unexpected boost may consider the time has come to have a word with an adviser who can recommend the right plan for you which, in turn, could potentially enable you to invest in an enjoyable retirement lifestyle as so many others have already done.
A final word of warning. Releasing money from the home is not necessarily for everyone as it could affect the value of your estate and impact upon your entitlement to means-tested state benefits – that is, of course, assuming they continue to exist – for women or men.
