PAY DAY
Pay rise for millions of grandparents as state pension and benefits set to increase next year – how much will you get?
Plus we reveal when payments will increase
MILLIONS of grandparents are in line for a pay boost next year which could see them hundreds of pounds better off.
The state pension increases every year in order to keep pace with the rising cost of day-to-day items such as food and household bills.
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It is set to rise by 4.1% from next April, under what is known as the triple lock guarantee.
This system puts up the state pension rate in line with whatever is highest of wages for May to July, 2.5% or September’s inflation figures.
Employee wages grew by 4.1% in the three months to July, while the UK’s rate of inflation was 1.7% in September.
This means that the State Pension will increase from £221.20 a week to £230.30.
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And a yearly rise from £11,502 to £11,975 - a £473 increase.
Only those who receive the full new state pension will get this amount.
How much an individual will get depends on their national insurance record and the number of qualifying years they have.
You need 35 years of national insurance contributions to qualify for the full state pension.
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Caring for children or providing care may also give you equivalent credits which count towards your national insurance record.
Older pensioners who reached age 66, the state pension age, before April 2016 will get a weekly rise from £169.50 to £176.45.
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Over the course of a year this would take their income from £8,814 to £9,175.40 a year.
These increases are expected to be confirmed by the Chancellor in her Budget.
Retirees on certain benefits such as Pension Credit and Attendance Allowance will also see their income boosted.
How does the state pension work?
AT the moment the current state pension is paid to both men and women from age 66 - but it's due to rise to 67 by 2028 and 68 by 2046.
The state pension is a recurring payment from the government most Brits start getting when they reach State Pension age.
But not everyone gets the same amount, and you are awarded depending on your National Insurance record.
For most pensioners, it forms only part of their retirement income, as they could have other pots from a workplace pension, earning and savings.
The new state pension is based on people's National Insurance records.
Workers must have 35 qualifying years of National Insurance to get the maximum amount of the new state pension.
You earn National Insurance qualifying years through work, or by getting credits, for instance when you are looking after children and claiming child benefit.
If you have gaps, you can top up your record by paying in voluntary National Insurance contributions.
To get the old, full basic state pension, you will need 30 years of contributions or credits.
You will need at least 10 years on your NI record to get any state pension.
The increase will be different for each one.
Here we explain how it will work.
Pension Credit
Retirees who are on a low income can see it boosted via Pension Credit.
The benefit is also set to rise in line with July’s wage data at 4.1%.
Pension Credit is set to rise from up to £218.15 a week to £227.09 if you are single or from £332.95 to £346.60 for couples.
To be eligible for Pension Credit your income must be lower than these thresholds.
You could also get the “Savings Credit” element of Pension Credit if you meet both of the following criteria:
- You reached State Pension age before 6 April 2016
- You saved some money for retirement, for example through a personal or workplace pension.
At the moment you will get up to £17.01 a week if you are single but this could rise to £17.69 from April.
Meanwhile, couples currently get up to £19.04 a week but this could be boosted to £19.82 from next year.
The exact rise will be confirmed by the Government next week.
You may also be able to get a top-up amount if you are caring for someone else or you are disabled.
You can apply online through the government website if you have already completed a claim or your State Pension.
To do so you will need your national insurance number, information about your income, savings and investments and bank account details.
Alternatively you can apply by phone by calling the Pension Credit claim line on 0800 99 1234.
Another option is to apply by post.
To do so you will need to print out and fill in the Pension Credit claim form or call the Pension Credit claim line to request a form.
Send it to: Freepost DWP Pensions Service 3.
Attendance Allowance
Attendance Allowance helps with extra costs if you are above the state pension age and have a disability severe enough that you need someone to help look after you.
To get the benefit you must have reached the state pension age and meet the following criteria:
- Have a physical disability (including sensory disability, such as blindness), a mental disability (including learning difficulties) or both
- Your disability is severe enough that you need help caring for yourself or someone to supervise you
- You have needed that help for at least six months
- Have been in Great Britain for at least two of the last three years
- Be habitually resident in the UK, Isle of Man or the Channel Islands
You cannot get Attendance Allowance if you live in a care home and your care is paid for by your local authority.
But you can still claim Attendance Allowance if you pay for all of your care home costs yourself.
Attendance Allowance is paid at two different rates and how much you can get depends on the level of care that you need due to your disability.
The lower rate is currently worth £72.65 a week.
From next April the payments may rise to £75.63 - an increase of £2.98.
The higher rate is worth £108.55 a week and could rise to £113 - a boost of £4.45.
You can apply for Attendance All online or by post.
You will need your national insurance number, address, contact details, details of your health condition or disability and information about your GP surgery or medical centre.
To apply by post you will need to download the Attendance Allowance claim form from the Government website or contact the helpline to request a claim form.
Send the completed form to: Freepost, DWP Attendance Allowance.
If you think you are eligible then it is worth applying as you could also get other benefits such as extra Pension Credit, Housing Benefit or a Council Tax Reduction.
If you need help completing the form then contact your local Citizens Advice.
How do I claim the state pension?
The state pension is not paid automatically - you must claim it once you are eligible.
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You should get a letter no later than two months before you reach state pension age, which will explain what you need to do.
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