State Pension Facts

1. The average weekly state pension payment is £130.30 State pension recipients currently receive £130.30 a week on average.

The exact amount you’ll receive, or whether you’re eligible for payments at all, is largely dependent on your National Insurance contributions. The basic state pension is currently worth £115.95 a week, but some people get additional state payments on top of this.  The system is being transformed in April 2016, but if you reach state retirement age before April 6, 2016 these changes won’t affect you.

 

2. The rates for the new single-tier state pension from April 2016 was announced at £155.65/ week – the same for both men & women.

People might get more or less than the indicated full new state pension – if they’ve built up additional state pension, they might get more. If they were contracted out for a significant time, they will probably get less.

Find out more: How much state pension will I get here

 

3. When can I claim state pension?

You can claim state pension when you reach state pension age. For men this is currently 65. For women, state pension age has started to rise, from 60 in 2010 to 65 in November 2018. Find out your pensionable age here.

 

4. Pension credit

One in seven state pension claimants also receive pension credit. This is a ‘means-tested’ benefit based on your earnings and tops-up your basic state pension to a minimum weekly income of £151.20.

 

5. You can top up your state pension

If you find that you have a state pension gap and had reached state retirement age by April 6 2016 then you can top up your state pension by making a one-off lump-sum payment to the government.  These payments, called Class 3A National Insurance contributions, allow you to boost your state pension by up to £25 a week.  The cost of Class 3A NICs falls with age.  For those aged 65, an extra £1 per week of state pension income will cost £890, while an extra £25 a week will cost £22,250  For those aged 80, it would cost £544 for an extra £1 a week, or £13,600 for £25 per week

6. More than a million people are working beyond state retirement age Government statistics suggest more than a million people are working beyond state retirement age.

Some keep working because they need the money, while others do so because they enjoy their role.  You can still receive your state pension if you choose to carry on working, but you may choose to defer your state pension and boost your weekly payments when you eventually claim.    Currently, you’ll get the equivalent of 10.4% extra for each year you defer, although this falls to 5.8% for those that reach state retirement age after April 2016.
If you’d like to find out more about how to save for your pension tax efficiently by saving through your business, call LeeP on 01733 699033 or email Polly@leepfinancial.co.uk.