Britons reaching the official retirement age this year are being urged to claim their State Pension entitlement – or they could miss out on payments.
State Pension currently provides essential financial support for almost 13 million older people across the country and is available for those who have turned 66 and have paid at least 10 years’ worth of National Insurance Contributions.
Many people approaching the official retirement age this year may not be aware that the contributory benefit is not paid automatically by the Department for Work and Pensions (DWP) and needs to be claimed.
Those who do not claim their State Pension could miss out on payments of up to £221.20 a week.
people can either claim State Pension or delay claiming it
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The money is not paid automatically when someone reaches State Pension age as some Britons may choose to defer their claim and continue working to generate more towards their pension pot.
This could be the case if someone has not paid the full 35 years’ worth of National Insurance Contributions, or were “contracted out”.
DWP guidance says: “You do not get your State Pension automatically – you have to claim it. You should get a letter no later than two months before you reach State Pension age, telling you what to do.”
It then explains that people can either claim State Pension or delay claiming it. It states: “If you want to defer, you do not have to do anything. Your pension will automatically be deferred until you claim it.”
Unless pensioners respond to the letter confirming they want to start claiming State Pension, they will not receive any payments as the DWP will interpret no response as a wish to defer.
Deferring State Pension could increase weekly payments when a person decides to claim it – as long as it’s deferred for at least nine weeks.
For those who reached state pension age before April 6, 2016, the rate of uplift is one per cent for every five weeks they defer, subject to a minimum deferral period of five weeks. This works out at a 10.4 per cent increase in their state pension if they defer for 52 weeks.
Based on the 2024/25 basic state pension of £169.50 per week, this works out at an extra £17.62 per week for life if they deferred for 52 weeks.
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For anyone who reached state pension age on or after April 6, 2016, the deferral rate is one per cent for every nine weeks they defer, or just under 5.8 per cent for every 52 weeks.
They have to defer for at least nine weeks in order to benefit from this boost and there is no upper limit on how many years one can defer.
This increase is applied to the flat-rate state pension. Based on someone receiving the full flat-rate state pension for 2024/25 of £221.20 a week, a person who deferred for 52 weeks would get an extra £12.82 per week for life.
Whether or not state pension deferral is the right option will depend on one’s personal circumstances.
For some, it simply won’t be possible as they need the state pension income as soon as possible, while for others it might depend on their health and lifestyle. But if someone is in good health then it could be worth considering. However, retirees are warned that any extra payments generated from deferring could be taxed.
Once claimed, the first payment will be made within five weeks of reaching State Pension age, followed by a full payment every four weeks after that.
A State Pension forecast online can be checked on the Check your State Pension service which will provide individual State Pension age, an estimate of how much State Pension a person may get at that point and if the amount could increase.
It also allows pensioners to view their National Insurance contribution history.
