More than four in 10 (42 per cent) individuals with a state pension age (SPA) between 66 and 67 know their SPA correctly within three months, research from the Institute for Fiscal Studies (IFS) revealed, suggesting "significant" knowledge gaps among those approaching retirement.

The research found that in the same cohort, 42 per cent overestimated their SPA, 12 per cent underestimated it, and 5 per cent claimed not to know their SPA.

Meanwhile, for those whose SPA is 67, 60 per cent know their SPA correctly within three months, while 12 per cent overestimated it.

Around one in seven (15 per cent) of those with an SPA of 67 underestimated it, and 14 per cent claimed not to know their SPA.

For those with an SPA of 66, 65 per cent know their SPA correctly within three months, while 22 per cent overestimated it.

Additionally, 4 per cent of this group underestimated their SPA, and 8 per cent claimed not to know their SPA.

The research suggested that overall, around 60 per cent of respondents accurately identified their SPA within three months, while 18 per cent overestimated it, stating that their SPA was higher than it is.

However, IFS expressed concerns over the fact that overall 11 per cent did not know their SPA at all and 11 per cent underestimated it, indicating that 22 per cent of individuals have knowledge gaps that could lead to poor decision-making about their savings or when they
retire.

The research also showed that certain groups are more likely either to underestimate or to be unaware of their SPA, particularly women, those with lower qualifications, those with lower levels of wealth, the self-employed, and those not in paid work.

For example, people in the top-wealth fifth quintile are 11 percentage points less likely to be unaware or underestimate their SPA than those in the bottom-wealth fifth.

The IFS explained this gap in understanding poses risks for people approaching retirement, especially those who subsequently discover that they must wait longer than they had thought before receiving a state pension and may face a period of unexpectedly low income.

Commenting on the research, IFS senior research economist and author, Heidi Karjalainen, said that most people in their 60s are well informed about their SPA, however, one in six of those with an SPA between 66 and 67 – equivalent to about 130,000 people – either underestimate or do not know what their SPA is.

She emphasised that this is “especially important” as the state pension age rise from 66 to 67 is “imminent”.

“If individuals discover that they have to wait longer than they had thought to claim the state pension, they may regret having retired or not having saved more,” she continued.  

“It is important that there are clear communications from both the government and private pension providers around increases in the state pension age, to help people avoid costly surprises and plan more effectively for later life.”

The next rise in the SPA will be from 66 to 67 starting in April 2026, affecting anyone born after 6 April 1960.

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