Pensioners born before 1953 are much worse off unless they claim (Image: Getty)
State pensioners are set for another payout boost from this April thanks to the – but older retirees are missing out on as much as £7,561 per year.
The automatically increases payouts each year, either by inflation, wage growth or a flat 2.5%, whichever is highest. This year, wage growth is 4.1% so it is the figure used to calculate pension increases. But many may not realise that the pension system is split into two schemes depending on when you retired.
State pensioners born before 1953 if they are a woman and 1951 if they’re a man will see their pension increase by 4.1% from £169.50 to £176.45 per week. This is the old basic , which was replaced in 2016 and anyone who hit retirement age on or after April 6, 2016 will receive the new instead.
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Across a full year, that means those on the old will receive £4,411.25 in pension payments.
The full new is going up by 4.1% as well, up from £221.20 per week to £230.25 per week.
That means those on the full new will receive £11,973 over a year – that’s a staggering £7,561.75 more than those on the old .
In both cases, these are the maximum amounts, for which you need roughly 30 to 35 years of National Insurance records in order to qualify.
For those stuck on the old , there are ways to increase your payments, the biggest one being Pension Credit.
Pension Credit tops up your pension payouts if you currently receive less than about £218 per week, so most people on the old will be eligible assuming they have no other income (like a private pension or second property rental).
Those who are retired on the old pension can claim Pension Credit to top up their income to £218.15 per week for a single person and £332.95 for a couple.
Pension Credit is also going up in April, to £227.10 for a single person and £346.60 for a couple.
It means that you’d receive £11,809.20 if you claimed Pension Credit, only £163.80 less than someone who retired after 2016 on the full new .
To apply for Pension Credit, call the Pension Service Helpline on 0800 991234.