Three things to think about when setting your target age
This article explains what a target age is, and the most important things to consider when working out the right target for you.
Taking your pension may feel a long way off yet. When you're ready to start planning for life beyond work here are three simple ways to get started.
Your 'target age' is when you think you will start taking your pension money
It helps us to invest your money in the right way. And it helps you decide how to put money into your pension over time.
Does your target age feel like a long way off?
We get it. But even a rough idea helps. And you can easily change it again if you need to
Three questions you ask yourself when setting your target age
1. How long do I want to work for?
Does the thought of being in work beyond your late sixties fill you with dread? Or do you like the idea of working as long as you can?
It could make a big difference to the number of years you need to cover with your pension money. And to the number of years you have to pay in.
The earlier you want to start accessing your pension money, the more you might want to put in early on.
2. What type of retirement do I want?
Are you planning for all the fun and adventures that weren't possible before? Or having enough money to cover the important essentials?
As a rule of thumb. many people aim to manage with about two-thirds of their working income when they retire.
If your main source of income will be your pension, the size of your pot - and the age you plan to start accessing it - needs to reflect that.
3. How much have I already saved?
If you started saving for your pension early, you may have more flexibility about when you can afford to stop working.
If you started later, you may need to pay in for longer to build up a pot that will support you to the standard you're looking for in retirement.
Have a look at how much you are likely to get in retirement, based on what you have saved now and further contributions you plan to make.
More useful questions about target age
Want to go a little deeper? It's always good to ask:
Will I get money from elsewhere?
If you expect to have another income other than your pension - for example, from benefits or rental income - this can reduce the pressure to build your pension.
How long do I think I might live?
Hard to know, of course - but on average, people retiring in their late sixties can expect to live for another 20 years.
What might my future costs be?
Will you have housing costs or expenses connected with children? Do you expect them to be lower or higher than now?
FAQs - setting your target age
Not sure when you might want to start drawing on your pension savings. Don't worry - many of us don't know the answer to this question yet. It's still worth making a best guess and letting us know. We invest your pension £ carefully with the aim of maximising what you have available in your pension just when you need it. The “target age” for accessing pension savings plays an important role in how we do that. We set a default target age of 65. Does that sound right to you?
We have some useful resources to help you understand more about this, and some ideas to help you think about and plan a timeline for later life. For example How we invest your money over time
It's quick and easy to do in the app.
Go to the home screen and select your pension pot
then click target,
then select 'change target' where you get the option to 'change your target age'.
If you haven't told us your target age we've set it to 65 as a default.
This is the age you can claim state pension from. Currently it is 66 for women and men. This will increase in the next few years and is likely to continue to do so over coming decades.
Your National Insurance (NI) contributions over the course of your working life determine how much state pension you get. If you are employed, these are usually paid at source when tax is taken from your pay. If you work freelance or run your own business you pay them to HMRC when you pay your tax bills.
You can find out how to check your entitlement from Money & Pensions Service here
Currently the State Pension still exists and has not been abolished. People who are aged 66 or older in the UK and have paid National Insurance contributions are eligible to claim it. This is rising to 67 between 2026 and 2028 and is likely to continue to rise in coming years. However there has been no announcement about longer term plans to abolish the State Pension completely. If you’re surprised to hear this, you aren’t alone. Research shows that most working people believe they will not be able to draw on a State Pension by the time they reach older life.
It depends. We use the term target age as not everyone looking to access their pension will want to actually retire. So we think of it as the age you hit your savings target and can start accessing your hard saved money. You might be heading off into the sunset on your motorbike at that point. You might be part-time working at the local charity shop. It’s your money and your life.
You can withdraw money from your pension at any age from 55 onwards (57 from 2028 onwards). In exceptional circumstances you can withdraw earlier. For example if you are diagnosed with a terminal illness or need to stop working due to ill health. Get details on exceptions from the Money & Pensions Service here
The good news is your money does not disappear. Your pension pot will be passed on to your nominated beneficiaries, i.e. we'll make sure it goes to whoever you've told us should have it. That could be your next of kin, but it doesn’t have to be. You can nominate anyone - family, friends, or even a charity or good cause you support.
Yes, sorry about the official jargon. It just means telling us when you think you'd like to start accessing your pension money. It’s really helpful for us to know because it helps us invest your money in a way that means you should get the biggest possible pot at the time you need it.
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