Finance

State Pension UK: Simple way to boost your monthly pension payment

State Pension is offered by the government’s Department for Work and Pensions (DWP) as an assistance measure in retirement. The sum may help those who have retired with the cost of living, as well as providing a contribution towards any goals they may have in later life. Under the ‘old’ or basic State Pension, pensioners will receive a maximum of £134.25 dependent on their contributions.

However, under the new system, available to those who retired after April 6, 2016, those entitled could receive up to £175.20 per week. 

But there is a simple action which could provide the State Pension sum with a cash boost.

This could help those who are entering retirement with the myriad of costs which may come their way. 

The government has helpfully laid out the way in which pensioners can increase their entitlement.

READ MORE: State Pension UK: Update for those changing from Universal Credit

If someone chooses to defer their State Pension for even 12 months, this could provide an increase of almost six percent. 

When the pension is claimed, the extra amount is included with the final sum a pensioner receives each week. 

Deferral is also available for those under the older State Pension scheme, although the rules slightly differ.

These people can usually take their extra State Pension as either higher weekly payments or a one-off lump sum.

When the deferred pension is eventually claimed, pensioners will receive a letter asking how they want to take their extra pension.

They then have three months from receiving that letter to decide their chosen method.

Under this scheme, the pension can increase every week it is deferred, as long as it is deferred for at least five weeks.

The sum will increase by one percent every five weeks, meaning those who defer for 52 weeks will get a 10.4 percent increase.

Once again, this extra amount is paid with a regular State Pension sum. 

The State Pension has also been given extra protections by the government. 

The Triple Lock mechanism, first introduced in 2010, was widely welcomed as a way of making sure the State Pension sum increased each year.

The mechanism ensures the State Pension figure rises each year by the highest amount out of: inflation, average earnings, or 2.5 percent. 



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