The new 2024-2025 tax year is underway, and with it comes one of the biggest increases for the UK State Pension since its introduction in 1909.
In this article, we’ll explain why the UK State Pension has increased and share our top tips for planning your retirement.
UK State Pension Increase April 2024
On the 1st of April, the UK State Pension increased by 8.5% – the second-biggest increase on record. Those who qualify for the full new state pension will now receive £221.20 a week (up from £203.85). While those on the older basic State Pension will receive £169.50 (up from £156.20 a week).
This increase is due to the ‘triple lock’ promise, first introduced by the coalition government in 2011-2012. The triple lock is a safety measure that ensures UK state pensions don’t lose value in the face of inflation. It is a three-way guarantee that increases the state pension each year in line with whichever is the highest:
- Average earnings
- Inflation (measured by the Consumer Price Index CPI)
- 5%
So, in 2024, the UK state pension has risen in line with average earnings growth between May and July 2023.
Changes to the State Pension age
While there are no changes to the age at which you can claim your State Pension this year, the age will rise to 67 between 2026-2028. This follows the last rise to 66 in 2020.
If you’re wondering about your retirement age and the amount of State Pension you’re likely to receive, you can use the Government’s free State Pension forecast tool at https://www.gov.uk/check-state-pension
Funding your retirement
Before you reach pension age, you need to plan for your retirement. To maintain a comfortable lifestyle you’ll need considerably more than the UK State Pension, and, if you want to spend your retirement traveling and relaxing abroad, you’ll need even more.
Pensions advice from The Bateman Group
We help prepare for the future. Our financial advisors are here to help you with a wide variety of pension planning options, financial advice, and asset management services.
Our pension planning services include detailed ‘cash flow forecasting to help you understand your future needs and choose the right pension plan. For information and advice please do get in touch.
