On 6th April a new state pension is being introduced affecting all retirees who reach state pension age on or after this date (Pension Advice Bristol).
However, while the new “flat rate” deal is designed to be simpler, the reality could be anything but for those who have accrued some or all of their entitlement under the “old” scheme.
Indeed the situation is considered so confusing that in October a group of MPs launched an inquiry, investigating why the government had failed to adequately communicate the changes.
The new flat-rate pension sounds good on paper. Paying £155.65 a week – well up on the £115.95 currently being paid by the basic state pension (which raises to £119.30 from April) – to everyone who has been making National Insurance (NI) contributions for 35 years (up from 30). Those with fewer than 10 years’ contributions won’t receive a proportional, while people with between 10 and 35 years’ contributions will receive a promotional amount.
You don’t have to have worked for 35 years solid to eligible. You get NI credits if you’re claiming certain benefits, are a carer or have taken time out to raise young children. Importantly, for the first time everyone has their own allowance built up by your spouse, nor is there special treatment if you divorce or your spouse dies.
(Moneywise, Rachel Lacey)
Pension Advice Bristol
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