Tuesday, November 24, 2020

Pension credit warning: DWP figures show one million eligible families are not claiming | Personal Finance | Finance

Pension credit warning: DWP figures show one million eligible families are not claiming | Personal Finance | Finance

Pension credit is a benefit for state pensioners who are on a particularly low income in retirement. The benefit is split into two parts, with the Guarantee Credit element topping up payments to £173.75 per week for single people or £265.20 for couples when they fall below those levels.

Some retirees may also qualify for Savings Credit which is an extra payment of up to £13.97 or £15.62 for people who saved some money towards their retirement, with a personal pension being an obvious example.

Today, the DWP released figures on estimated take up levels of pension credit for the 2018-2019 year.

The data highlighted up to one million eligible families did not claim pension credit, potentially costing families £1,700 per year, amounting to £1.8billion being unclaimed.

Additionally, the data revealed take-up was lowest among couples.

READ MORE: Pension: DWP launches ‘Stronger Nudge’ measures to boost guidance

Stephen Lowe, a director at Just Group, also dove into the figures and examined how different groups of people are faring with this.

He also issued a reminder that claiming responsibilities ultimately falls on pensioners themselves but support is available: “At an individual level that suggests many people struggling to make ends meet may not realise they are entitled to financial help or find the system too confusing to understand. Take up is lower among couples (56 percent) than for single males and single females (both 65 percent).

“Our own research found that four in 10 (42 percent) of those aged over 65 had never checked if they were eligible for a benefit, a figure that is higher among homeowners (49 percent) and those aged over 80 (57 percent).

“Ultimately it is the responsibility of people to claim for themselves.

Pension credit rules are slightly different for people based in Northern Ireland.

When working out if a claimant is eligible for pension credit, the government will look at multiple sources of income, which includes:

  • State Pension
  • other pensions
  • most social security benefits, for example Carer’s Allowance
  • savings, investments over £10,000 – for these £1 is counted for every £500 or part £500
  • earnings

The payments may be affected if the claimant leaves Great Britain and as such, the pension service helpline should be contacted for clarity.

A person will not be able to receive pension credit if they leave Great Britain permanently.

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