Under 40s should be allowed to draw down a year’s worth of state pension now, to help ease acute financial anxiety.
In return the age they start receiving a state pension age would start a year later.
The proposal has come from the Social Market Foundation think tank.
It’s called the idea the Citizens Advance, which was first suggested by Andrew Lewin, Labour MP for Welwyn Hatfield.
Under the proposal, anyone aged between 28 and 40 who has accumulated at least 10 years of National Insurance credits would be eligible to apply for the Advance.
They would receive £12,548 - the current annual value of the full new state pension - and in return, their state pension would begin one year later than it otherwise would.
Based on the principle of contribution, time spent caring for children or relatives could also count towards being eligible for the Citizens Advance.
Most 25-40-year-olds were in favour of the Citizens Advance, irrespective of whether they would take it, with 54% positive versus just 6% negative.
Many were keen to take the Advance, according to the SMF report, ranging from 50% to 70% depending on the value of the lump sum, length of state pension forsaken and restrictions on how it can be spent.
Debt repayment and was the most popular intended use of the Citizens Advance, chosen by 18% of respondents. Housing was the second most popular, on 16%.
What will the policy cost? Depending on eligibility, taxed/untaxed, size of lump sum and so on, the costs could vary from £3bn to £7bn a year once the policy has embedded, the SMF said, adding that most of the costs of the Advance would be saved from the state pension system.
Jamie Gollings, deputy research director at Social Market Foundation, said: “Britain is facing a crisis of opportunity. Whether you can buy a home, pay down debt, or start a family increasingly depends on the wealth of the parents you were born to – not the work you've put in.
“The Citizens Advance changes that. It’s not a handout – it gives younger people access to capital they've already earned, at the moment in their lives when it can make the biggest difference. Our research shows this isn't just popular across the political spectrum, it'll be transformative.”
He urged policymakers to explore the “radical and fiscally credible policy proposal.”
He added: “The cost of inaction is a generation locked out of homeownership, drowning in debt, and losing faith that the system can work for them at all.”
• To explore attitudes to a potential Citizens Advance, a nationally representative survey of 2,000 25- to 40-year-olds was carried out via Opinium from 18 December 2025 to 7 January 2026. 300 in-depth interviews with adults aged 25-40 were carried out using Focaldata’s AI Qual platform, with interviews carried out in January 2026. Three focus groups were also carried out in August 2025 with 7-8 participants.