£900 state pension boost ‘not enough’ as retirees still face ‘concerning situations’
National Insurance records can be topped up by paying voluntary National Insurance contributions
GETTY/PA
State pensioners will see an increase in their payments from next week as the state pension is set to increase by 8.5 per cent.
The full new state pension will rise by around £900 per year, while the full basic state pension will increase by £691 per year.
Even though this is the second-biggest increase to the state pension on record, experts have said it will not be enough to sustain a retiree’s lifestyle.
Pension experts from Spencer Churchill Claims Advice said the current state of the UK pension system reflects a “concerning situation for retirees”.
They said: “Despite annual increases, pensioners can barely keep up with the rising cost of living.
“For instance, the average pensioner in Britain faces a £40 monthly shortfall compared to last year, even with yearly pension bumps.
The new state pension is set to increase by £900 a year
PA images
“Currently, the maximum state pension in the UK pays a total of £884.40 per month to retirees, which is just £74.40 more than the average cost of living for a pensioner.
“Although the state pension will soon rise to over £220 a week, it won't stretch far enough due to the higher cost of living.”
According to the Retirement Living Standards, a single person would need £12,800 a year just to cover a ‘minimum’ retirement lifestyle.
The full new state pension will be just over £11,500 a year from April meaning there is a slight gap between what people may need and actually get in retirement.
The state pension alone will only cover a very basic lifestyle under the RLS standards so Britons are urged to plan ahead to ensure they have enough to fund the lifestyle they wish.
It is suggested that the state pension should only be a part of one’s overall retirement plan.
State pension 2024/2025
Chancellor Jeremy Hunt confirmed that the triple lock on pensions would go ahead, with state pension rates set to rise by 8.5 per cent from April 1.
The rise in state pension means that those qualifying for a full new state pension will now receive £221.20 a week (up from £203.85).
Those who reached state pension age before April 2016, who are on the older basic state pension, and are entitled to the full amount, will receive £169.50 per week – up from £156.20.
Mr Hunt told MPs: "The triple lock has helped lift 250,000 older people out of poverty since its inception in 2011.
"It has been a lifeline for many during times of inflation.
"We honour our commitment to the triple lock in full. We will increase the new state pension by 8.5 per cent, worth up to £900 more a year."
The amount of state pension people get is based on how many years they have on their National Insurance record.
LATEST DEVELOPMENTS:
Britons can check their personal National Insurance record and get their state pension forecast ahead of retiring. The state pension forecast will let someone know if they have gaps in their record.
Britons can boost their state pension entitlement by filling these gaps such as by claiming National Insurance credits, or otherwise considering buying some extra years.
Where credits aren’t available, National Insurance records can be topped up by paying voluntary National Insurance contributions.
The deadline for doing this is normally April 5 each year. Currently, Britons have until April 5, 2025, to fill gaps in their National Insurance record from as far back as 2006.
GB News contacted the DWP asking for comment.