The state pension rises every year in line with the triple lock promise, which guarantees payments go up by whichever is highest out of inflation, wages, or 2.5%
Millions of state pensioners are set to see their payments rise this April.
The state pension rises every year in line with the triple lock promise. This guarantees the state pension goes up by whichever is highest out of inflation (using the previous September inflation figure), wages (average growth between May and July) or 2.5%. This year, state pension payments are rising by wage growth, which was confirmed to be 4.1%.
There are two different types of state pension and which one you claim depends on when you were born. You’ll claim the new state pension if you’re a man born on or after April 6, 1951, or if you’re a woman born on or after April 6, 1953. The full new state pension is worth £221.20 a week, or £11,502 a year, but this will rise to £230.30 a week, or £11,975 a year, from this April.
You claim the older basic state pension if you’re a man born before April 6, 1951, or a woman born before April 6, 1953. The full basic state pension is worth £169.50 a week, or £8,814 a year, but this will rise to £176.45 a week, or £9,175 a year, from this April.
The exact amount you get for your state pension depends on your National Insurance record. For the new state pension, most people need 35 qualifying years on their National Insurance record to get the full amount, and normally ten years to get anything at all.
However, many pensioners face paying tax, as the full new state pension edges closer to the current £12,570 tax-free personal allowance. Rachel Vahey, head of public policy at AJ Bell, said: “The state pension will be at a level perilously close to the frozen personal allowance and should overtake it in a couple of years if things continue, thanks to frozen tax thresholds.
“At that point something must surely give. But slowing the increase in state pension growth or unfreezing the personal allowance both seem unlikely. It could be that this fast-approaching crunch time means the government will finally be forced to address the question of how much the state pension should really offer, at what age, and how it can increase payments sustainably each year.”
The state pension increase comes ahead of a deadline for you to purchase missing National Insurance years and top up your state pension. At the moment, you can purchase missing National Insurance years dating back to 2006 – but after April 5, you’ll only be able to go back six tax years. This means if you have gaps in your record, you may not receive a full new state pension later in life.