In October 2015, we launched the State Pension top up scheme, giving everyone reaching State Pension age before 6 April 2016, the chance to boost their long-term income by up to £25 a week.
I am passionate about improving financial security in later life. Thousands of people have already applied, and we are continuing in our efforts to let more people know about the scheme, if they could benefit from it.
I want to stress that this scheme will not be suitable for everybody and it is important to seek guidance or advice to check whether it is right for you. However, it is likely to be of particular interest to people who historically haven’t had the chance to build significant amounts of State Pension, such as many women or those who may have been unable to build earnings-related additional State Pension in the past.
The scheme is open until 5 April 2017, with the opportunity for people to guarantee a higher retirement income for the years ahead with an index-linked boost, helping to protect pensioners against future inflation.
The additional income is also inheritable. Surviving partners will usually be able to inherit a minimum of 50% and up to 100% of this increased pension income, depending on how long ago their deceased partner reached State Pension age.
The cost of State Pension top up is based on a person’s age – the older you are, the lower the cost. For a 65-year-old, an extra £10 of pension a week will cost £8,900, whereas for a 75-year-old the contribution for the same amount of pension is £6,740.
State Pension top up is just one of the opportunities this Government is offering to improve financial security in later life, providing people with the option to increase their State Pension income. Other routes to explore would include paying Voluntary National Insurance contributions and potentially deferring your State Pension (or a combination of these options).
I really would urge you to seek independent advice before deciding what is best for you. If you are considering applying for State Pension Top up, you can find out more by looking at the online booklet and visiting the online calculator at www.gov.uk/state-pension-topup.
You can apply for the scheme at www.gov.uk/statepensiontopup.
Professional IFAs and accountants can register for specialist email updates on State Pension top up.
2 comments
Comment by richard leeming-mchale posted on
will this scheme continue for those retiring later?
Comment by DWP Pensions Latest posted on
No. The State Pension top up scheme is only for those who reached State Pension age before 6 April 2016 [for those eligible, applications are open until 5 April 2017]. However, there may be other ways in which you can increase your State Pension. For more information, take a look at this blog on 'How to increase your State Pension': https://pensionslatest.blog.gov.uk/2016/02/18/how-to-increase-your-state-pension/