Pension

£815 boost to state pension on Monday but many won’t get it all


Pensioners in the UK have been promised a record increase in their payments from Easter Monday, April 10. For those on the new State Pension, there will be an increase from £185.15 per week to £203.85 per week.

As pensions are usually paid out every four weeks, this will see a new amount of £815.40 a month going into accounts following a 10.1 per cent increase in the State Pension after the triple lock was kept in place. The triple lock means that the annual rise is linked to either inflation, wage growth or 2.5%, whichever of the three is the highest. The UK inflation rate was 10.1% in January, much higher than wage growth, hence the 10.1 per cent increase.



However, out of the 12.6 million people drawing a State Pension, only 2.9 million (23 per cent) are on the new State Pension. The remaining 9.7million (77 per cent) get the old basic State Pension that was in place before April 2016. This pays out £141.85, going up to £156.20 from April 10. Paid every four weeks, it will see £624.80 go into accounts. That’s almost £200 less per month than the new pension.

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There are other variations that can mean a person gets less than these figures. That’s because you need 35 qualifying years of National Insurance contributions to get the maximum new State Pension. You need 10 qualifying years to get any pension at all.

Lower amounts of National Insurance paid into the system by many workers mean the average new State Pension for a man is £175.84, while for a woman it’s a similar but slightly lower £170.52, reports Birmingham Live.

For the old basic State Pension, if you’re a man you usually need 30 qualifying years if you were born between 1945 and 1951, and 44 qualifying years if you were born before 1945. And if you’re a woman you usually need 30 qualifying years if you were born between 1950 and 1953, and 39 qualifying years if were born before 1950.



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