As the ‘biggest increase in a decade’ is projected, how much may you collect from the state pension?
PENSIONERS could see the highest boost in their state pension in a decade, according to the new ‘double lock,’ which could result in a four percent increase.
The typical triple lock will be temporarily suspended for the coming year, which means that seniors will not enjoy as large of an increase as they had hoped. However, a significant increase in the state pension is still possible.
Under the triple lock, the value of the state pension appeared to be on track for an increase of 8% or more, but the government later announced that the policy would not be honored in its customary form for the 2022/23 tax year.
Due to rising inflation rates in the UK, seniors may still see a decade-high gain in their weekly income, with some predicting a four percent increase in the value of the state pension.
Inflation in the UK grew by 3.2 percent in the year to August 2021, according to the latest current estimates, and the Bank of England believes this will rise to more than four percent in the year to September.
The rate of inflation for the year ending September, which will be released next week, will be used to determine how much the state pension would grow by next year, assuming it stays over 2.5 percent, as projected.
Inflation has been hovering around 2% for the previous 12 months, with the 1.2 percent increase between July and August setting a new high for a month-to-month increase.
The whole new state pension is currently worth £179.60 per week, providing up to £9,339.20 per year to retirees. The full basic state pension is £137.60 per week, equating to £7,155.20 per year.
If the state pension were to grow by 4%, retirees receiving the full basic state pension would receive £186.78 per week, up £7.18 from the previous level. In this situation, they would earn an extra £373.36 per year.
Those on the full basic state pension would see their weekly income increase by £5.50 to £143.10 per week. That equates to £286 in extra income over the course of a year.
The triple lock on the state pension is a government initiative. “Brinkwire News Summary.”