With the state pension set to rise by 3.9% this April, you may be wondering if you will benefit from this increase.
The increase comes under the triple lock introduced by the government in 2010. It guarantees that the state pension sees an increase every year based on inflation, average earnings or a minimum of 2.5%, – whichever is the largest. It was put into legislation to protect pensioners and to ensure that their income was not eroded by inflation hikes. This year’s increase is tied to wage growth.
How much will I see per week?
The new state pension will rise from £168.60 to £175.20 per week which means that some will get an extra £344 per year, whereas the basic state pension will increase from £129.20 to £134.25 per week. The two pensions still benefit from the 3.9% increase, even though the figures differ.
The Express reminds readers that not everyone will be given this increase and that under transitional arrangements, not everyone will get that amount. The DWP reminds us that the new state pension uses information from National Insurance contributions and that some people will receive more and others will receive less. It also points out that if a person retires abroad, their pension could also be affected.
How is my state pension affected if I live abroad?
The government state that if you claim the state pension from abroad, it will only increase if you live in certain places. Those places include the EEA, Gibraltar, Switzerland, and countries that have a security agreement in place with the UK. However, it should be noted that if you reside in Canada or New Zealand, you will be exempt from any state pension increases under the current legislation.
Of course, whilst there is some guidance available, you may wish to speak with a financial adviser who can use financial adviser software to help you make informed decisions about your finances. If you would like some insight into this packaged software, you can look at https://www.intelliflo.com/financial-adviser-software.
This particular type of software uses online client portals so you can seek some advice online, and it integrates with the UK financial services market, enabling you to get the most accurate and beneficial advice for your circumstances.