New payment rates mean pensioners now benefit from extra cash in their bank account.
State Pension rates increased by 4.1% at the start of the new tax year in April (Image: Getty)
State Pensioners across the UK have been handed a boost of up to £470 after three changes hit bank accounts.
The State Pension increases at the start of every new tax year on April 6 and the amount it goes up is based on the highest out of three factors, known as the ‘triple lock’. These include the consumer price index (CPI) measure of inflation (measured for September the year before), average wage growth between May and July of the previous year, or 2.5%. This year, the basic and new State Pensions have been uprated by 4.1%, in line with the annual increase in the average weekly earnings index for May to July 2024.
As the new tax year begins on April 6, many pensioners will only have had one full month to fully benefit from the uplifts so far. For example, if your pension was paid between April 1 and April 6, you won’t have received the new higher rate, but every pension payment in May will have been at the higher rate, and the increase is worth up to £470 per year for many pensioners.
As the State Pension system is split into two schemes – basic and new – the amount extra in pension payments from April 6 depends on when you retired.
1. Basic State Pension
Men born before April 6, 1951, and women born before April 6, 1953, receive the basic State Pension and under the new rates will now get up to £176.45 per week – a weekly increase of £6.95 on the previous rate.
Over the course of a year this amounts to an extra £360 to your pension pot if you get the full rate. It means those on the full new rate will receive £9,175.40 in pension payments across a full year from April 6, 2025.
You need to have a certain number of qualifying years of National Insurance to get this full amount, which for a man is usually 30 qualifying years if you were born between 1945 and 1951, or 44 qualifying years if you were born before 1945.
For women, you’ll need 30 qualifying years if you were born between 1950 and 1953, or 39 qualifying years if you were born before 1950.
If you have less than the full number of qualifying National Insurance years, then your basic State Pension will be less than £176.45 per week.
2. New State Pension
Men born on or after April 6, 1951, and women born on or after April 6, 1953, are eligible to claim the new State Pension once you reach State Pension age, which is currently 66.
People claiming this pension now get up to £230.25 per week if you get the full rate – a weekly increase of £9.05 on the previous rate.
Over the course of a year this amounts to an extra £470 in your pension pot, providing you get the full rate. It means those on the full new rate will receive £11,973 in pension payments across a full year from April 6, 2025 – £2,797.60 more per year than those who get the full basic State Pension.
3. Pension Credit
The standard minimum guarantee for Pension Credit also increased by 4.1% from April 6, meaning those over State Pension age and on a low income now have a bit extra cash per month to help with living costs.
It tops up your weekly income to £227.10 if you’re single, or to £364.60 if you have a partner. It means those getting the single rate now get £8.95 extra per week, while those on the joint rate get £31.65 extra per week.
Over the course of a year, this provides those who are single with £465.40 more annually, while couples will now be £1,645.80 better off per year.
Further boost to State Pension
The next triple lock decision, which will determine how much the State Pension will increase in the 2026 tax year, is due to be decided in September. This will be based on the previous September’s CPI inflation figure, as well as the average increase in wages over the previous year, and the increase will then be applied to payments in April 2026.
