Happy New Year to all our followers.
A quick update on some positive changes that have been made to the contributory State Pension – effective from 1st January 2024. The changes are welcomed giving people more flexibility and choice when planning around their retirement.
Anyone who reaches age 66 this year can now delay the date on which they take their contributory State Pension – up to age 70 – in exchange for a higher pension payment.
The full contributory State Pension maximum rate is currently = €277.30 @ age 66. The proposed maximum rates for each year of deferral are:
– €290.30 at age 67
– €304.80 at age 68
– €320.30 at age 69
– €337.20 at age 70.
You can still get your contributory State Pension at age 66 if you want to access it as normal.
It may be really beneficial for people… if you wish to continue working it may mean you pay less tax as you can delay drawing down your contributory State Pension. Or if you started work late, you may be short on contributions and being able to work longer gives you the chance to build up your contributions and potentially increase your contributory State Pension rate.
A potential issue that may arise is mandatory retirement at age 65 within the Private Sector. However Cabinet are waiting to approval new legislation extending the mandatory retirement age to age 66.
As always if you need advice on your Retirement Planning please reach out to Gráinne on grainne@sunrisefinancialplanning.ie
