UK state pensioners can look forward to a financial uplift this month as new payment rates kick in. Every new tax year, starting April 6, the State Pension sees a rise based on three key factors, known as the 'triple lock'.
The increase is determined by whichever is highest: the consumer price index (CPI) measure of inflation (calculated from September the previous year), average wage growth between May and July of the preceding year, or 2.5 per cent.
This year, both the basic and new State Pensions will see a 4.1 per cent boost, aligning with the annual increase in the average weekly earnings index for May to July 2024. However, because the new tax year starts on April 6, some pensioners won't have fully benefit from the new rates yet. For instance, if your pension was paid between April 1 and April 6, you wouldn't have received the new higher rate.
But rest assured, all pension payments in May will be at the increased rate, reports the Express. The State Pension system is divided into two schemes - basic and new - so the amount your pension payments will rise from April 6 depends on when you retired.
1. Basic State Pension
Men born before April 6, 1951, and women born before April 6, 1953, are entitled to the basic State Pension. They'll see their pensions go up by 4.1 per cent, from £169.50 per week to £176.45 - that's a weekly boost of £6.95. Over a year, this could mean an extra £360 in your pension pot if you're on the full rate. So, those on the full new rate can expect to pocket £9,175.40 in pension payments over the course of a year from April 6, 2025.
To get this full amount, you need a certain number of qualifying years of National Insurance. For men born between 1945 and 1951, that's usually 30 qualifying years, or 44 qualifying years if you were born before 1945.
For women, it's 30 qualifying years if you were born between 1950 and 1953, or 39 qualifying years if you were born before 1950. If you don't have the full number of qualifying National Insurance years, your basic State Pension will be less than £176.45 per week.
2. New State Pension
Men born on or after April 6, 1951, and women born on or after April 6, 1953, can claim the new State Pension once they hit State Pension age, currently 66. Those claiming this pension will also see their payments go up by 4.1 per cent from April, with the full rate jumping from £221.20 per week to £230.25.
Over a year, this could mean an extra £470 in your pension pot if you're on the full rate. This means those on the full new rate will receive £11,973 in pension payments over a full year from April 6, 2025 - that's £2,797.60 more per year than those who get the full basic State Pension.
3. Pension Credit
For Pension Credit claimants, the standard minimum guarantee is getting a 4.1 per cent boost from April 6, giving those over State Pension age with a tight budget a bit more to cover living costs.
Right now, Pension Credit tops up your weekly income to £218.15 if you're flying solo, or to £332.92 if you're part of a duo. Singles have also seen their rate jump to £227.10 weekly, and couples to £364.60.
That's an extra £8.95 per week for singles and a hefty £31.65 more for couples. When you add it all up, single pensioners are looking at an annual bump of £465.40, while couples can enjoy a whopping £1,645.80 extra each year.
The government said: "To help make sure pensioners are protected in their retirement, we have also confirmed a 4.1 per cent increase to the basic and new State Pension, as well as the standard minimum guarantee for Pension Credit, from April next year. Over 12 million pensioners will benefit as the full new State Pension will rise from £221.20 to £230.25 a week, providing an extra £470 a year. The full basic State Pension will increase from £169.50 to £176.45 per week, worth an extra £360 annually."
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