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Escape pensioner poverty – can you claim benefits?

Escape pensioner poverty – can you claim benefits?

Category: Retirement
26/04/2017

MONEYFACTS ARCHIVE
This article was correct at the time of publication. It is now over 6 months old so the content may be out of date.

Pensioner poverty is an ongoing concern, and it appears that things aren't getting any better, with research from Age UK highlighting that millions of people are struggling financially after they hit retirement – which is why they're urging people to check if they're eligible for benefits.

The charity cites Government figures which show that 1.9 million pensioners are now living below the poverty line, and that one in 10 of those aged over 65 wouldn't be able to pay an unexpected expense of £200. A further one in four are finding it difficult to make ends meet, yet there's some £3.5 billion lying idle in unclaimed benefits, so now's the time to check if you're entitled.

Key benefits and allowances for the 2017/18 tax year

Age UK points out that millions of people aren't claiming Pension Credit, yet in doing so they could be missing out on a much-needed income boost – the credit has slightly increased this month, which means those who make a claim could increase their income by an average of £42 a week, or £2,184 every year.

Other benefits and allowances that could benefit pensioners include the Attendance Allowance (£55.65 or £83.10 a week, depending on the assistance required), Housing Benefit (amount varies), Pension Credit - Guarantee Credit (tops up your weekly income to at least £159.35 if you're single or £243.25 if you're a couple) and
Pension Credit - Savings Credit
(an extra £13.20 for single people or £14.90 for couples). You can find out more about the various tax allowances for 2017/18 by reading our Tax Facts.

Make your money work harder

Not only is it worth checking if you're eligible for any extra support, but the figures also bring into sharp focus the need to prepare thoroughly for retirement, and to have a suitable savings plan in place to ensure an unexpected expense doesn't prove disastrous.

If you're still in work, you need to make sure you're enrolled in your workplace pension
scheme – if you're not yet, automatic enrolment means you soon will be – and try to save above the minimum contributions if you can. You'll want to make sure you've got additional savings set aside, too, and if you're already retired, this is when you need to make sure your money is working as hard as possible.

Finding the best savings rates is absolutely vital at all stages of life, but perhaps even more so if you're using your savings to bolster your retirement income. You may want to look for monthly savings accounts that allow you to divert any interest directly into your current account, but you'll probably need to look further than that to get the best interest rates – consider fixed rate bonds to grow your money for a few years, or even high interest current accounts for a portion of your savings.

If you're comfortable with an element of risk, it may be worth looking into stocks & shares ISAs for the potential of greater returns, but just make sure you know what you're getting yourself in to – speak to an independent adviser before you take the plunge.

A combination of pension income – be it through the state pension, a personal scheme or an annuity – together with additional benefits and a robust savings plan, will hopefully mean you're not contributing to the rise in pensioner poverty, and can enjoy your post-work years in as comfortable a manner as possible.

What next?

Find out more about pensions and retirement by reading our guides

Compare the best savings rates to find the best home for your money

Want guaranteed income throughout retirement? Aside from the state pension, an annuity is still the only way to achieve that. Find out more here

Disclaimer: Information is correct as of the date of publication (shown at the top of this article). Any products featured may be withdrawn by their provider or changed at any time.

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