The new State Pension is currently worth £230.25 per week if you get the full rate – and there’s a simple way to boost it by up to £694
State pensioners born after 1951 could potentially boost their pension pot by up to £694 thanks to a lesser-known rule, but it requires postponing retirement for an entire year.
Men born on or after April 6, 1951, and women born on or after April 6, 1953, are eligible to claim the new State Pension once they reach the current age of 66.
Those born before these dates will receive the basic State Pension instead. However, reaching 66 doesn’t automatically trigger your pension payments – you need to actively claim it.
You should get a letter at least two months before hitting State Pension age, asking if you want to claim your pension or defer it.
If you choose to defer, you don’t need to do anything else, as your pension will be automatically delayed until you decide to claim it.
This option also lets you add some extra cash to your pension pot – up to £694.20 if you delay for a full year. If you reach State Pension age on or after April 6, 2016, then your pension pot will grow every week you defer – provided you defer for at least nine weeks, reports the Express.
At present, for every nine weeks you defer your State Pension, it will increase by 1%, which equates to just under 5.8% for a full year, or £694.20.
The new State Pension is currently worth £230.25 per week if you get the full rate. So, by choosing to defer for 52 weeks, you can gain up to an additional £13.35 per week – totalling £694.20 over a year.
However, eligibility for the full new State Pension rate of £230.25 is not universal, and recipients of lower amounts may require more National Insurance qualifying years to elevate their weekly payments.
Claimants of the new State Pension must have at least 10 qualifying years on their National Insurance record to receive any payment, typically requiring 35 qualifying years to obtain the full amount.
Those qualified for the full amount will enjoy a £470 yearly boost following the 4.1% uprate of the new State Pension earlier this month.
The DWP stated: “With uprating in effect, pensioners receiving the full basic State Pension will see their weekly payments rise from £169.50 to £176.45 per week, worth an additional £360 a year. In addition, the full rate of the new State Pension will increase from £221.20 to £230.25 per week, an increase of £470 a year.”
Pensions Minister Torsten Bell said: “Raising the State Pension and rescuing the NHS – these are this government’s priorities to give all pensioners the dignity they deserve in their retirement. Those who have worked hard throughout their lives, paying into the system, are owed nothing less.
“We’re improving the lives of millions of pensioners through our £7.84 billion additional funding for the State Pension this year. That means up to £470 extra in pensioners’ pockets from this week and comes alongside our work to boost Pension Credit uptake, and the £26 billion we’ve invested in the NHS that has seen waiting lists in England fall for 5 months in a row.”