Knowing how much you’ll receive is vital for planning your future finances
The State Pension age is set to rise to 67 by 2028, followed by a subsequent rise to 68 between 2044 and 2046. However, there is currently a review being conducted to determine the appropriateness of the existing timetable.
This review will help to determine whether further adjustments to the State Pension age will be required in the future. As a result, it is likely that individuals’ retirement planning will need to be flexible enough to accommodate potential future changes to the State Pension age.
Accessible information
New research has revealed that one in seven (14%) of retirees received less money from the State Pension than they had expected[1]. This highlights the need for more accessible information on what individuals can expect to receive from the government during their later years.
The study also revealed that a fifth (20%) of retirees were unaware of how much they would receive from the State Pension before they retired, while one in ten (9%) found it challenging to determine what their payments would be.
Knowledge gap
The lack of awareness was observed not only among full-time workers but also part-time workers, with the knowledge gap being significant between homeowners (38% unsure) and those living in rented accommodation or with family members (50% and 54%, respectively).
The study also found that pre-retirees shared a similar level of uncertainty regarding their State Pension. Approximately three in ten (28%) respondents did not know their State Pension age, while 44% were unaware of the amount they could expect to receive from the State Pension upon retirement.
Triple Lock
Questions surrounding the ‘Triple Lock’ and the potential for the planned rise in State Pension age to 68 to be brought forward have added to the uncertainty surrounding the State Pension.
It’s essential to note that individuals need to claim their new State Pension as it is not granted automatically. Typically, an invitation letter would be sent no later than two months before reaching the State Pension age, explaining the steps to claim the pension benefits.
Pension entitlements
If someone is nearing the State Pension age and has not received an invitation letter, the individual could still submit a claim. In such cases, the quickest way to apply for the pension is online.
The constantly changing landscape can make it difficult to keep up with the latest information and seek advice on the value of pension entitlements and the age at which people will qualify for payments. As the State Pension is a crucial source of retirement income for many people, knowing how much they will receive is vital for planning their future finances.
Source data:
[1] Boxclever conducted research among 6,000 UK adults. Fieldwork was conducted 6 Sept–16 October2022. Data was weighted post-fieldwork to ensure the data remained nationally representative on key demographics. Comparisons to data from last year are taken from Boxclever research among 4,896 UK adults conducted between 16 and 23 July 2021.
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