State pension UK: 1.2 million pensioners missing out on £2,000 | Personal Finance | Finance

0
4


Retired households with the lowest incomes receive the least State support, according to new analysis by Just Group. The analysis of Office for National Statistics (ONS) figures show that the lowest income group (the bottom quintile) on average receive less income than all other higher income groups.

It has also found that this group also gets less income from other benefits than all but the group with the highest incomes (top quintile).

Those in the bottom quintile have an average gross annual income of £13,012.

Data shows they get on average £8,265 per year via the state pension, and £1,721 in other cash benefits – with these totalling £9,986 a year.

Meanwhile, those in the second quintile have an average gross annual income of £20,953.

READ MORE: 

This includes an average state pension of £10,893 and £3,339 in cash benefits.

In the third quintile the average gross annual income is £25,792, and average state pension is £11,101.

Other cash benefits come in at an estimated £2,573.

Average gross annual income rises to £35,777 for the fourth quintile.

The state pension amount is on average marginally higher at £11,679, while other cash benefits work out at £2,234.

DON’T MISS

Meanwhile, in the top quintile, the average gross annual income is £70,844.

Those in this group have an average state pension of £11,741, and other cash beenfits of £856.

Each quintile represents around 1.5 million pensioner households.

The analysis highlights the importance of cash-strapped pensioners checking their eligibility for benefits, Just Group has said.

“The common assumption is that those with the lowest incomes get the most State help but that’s not what the reality is,” said Stephen Lowe, group communications director at Just Group.

“The figures show that the 20 percent of pensioners with the lowest incomes receive the least money from the State.

“Even if you exclude state pension income and just look at other cash benefits, people with the lowest incomes still receive less than all but those in the very top income bracket.”

Commenting on the analysis, Mr Lowe continued: “The other striking fact is the very high levels of home ownership among those on the lowest incomes.

“More than 80 percent of those in the lowest income group own their homes which is higher than every other income group except the top income group.”

Mr Lowe also addressed a way in which some households may be able to boost their income – by claiming Pension Credit.

“Government figures show that about 1.2 million households fail to claim about £2.5billion a year in Pension Credit, equal to more than £2,000 income for each household,” he explained.

“This analysis shows it may be homeowners struggling on poor incomes who are most likely to be missing out, perhaps because they think the value tied up in their homes means they are not eligible for other benefits.”

Mr Lowe went on to say that the figures reinforce the need for State Benefits information to be given a high priority within the free, impartial and independent pension guidance available from Pension Wise to those considering accessing their pension money.

“Retirement planning is not just about making good choices with pensions, but also understanding the wider context of retirement and what other support is available,” he said.

“Homeowners in particular appear less likely to claim their eligible benefits so could benefit from a reminder at this key time of their lives.”



Source link

LEAVE A REPLY

Please enter your comment!
Please enter your name here