While Boris Johnson promised to hold a full budget within 100 days of his election victory, many of the details of next year’s state pension increases were unveiled last month. The budget will confirm the final figures, but the changes, which come into effect in April, are based on the “triple-lock” formula. This guarantees that state pensions will rise in line with the highest of inflation, average earnings, or 2.5%.
Back in October, the date at which this assessment is made, earnings growth was running at around 4%. As a result, the full new state pension will be £175.20 a week, up from the current £168.60. Alternatively, for those who reached the state pension age before April 2016, and receive the basic state pension, the weekly payment is rising from £129.20 to £134.25.
However, these are only headline rates. The most recent government data suggests only two-thirds of people receive the official figures; some get more and many get less, depending on the national insurance contributions they’ve paid. If you’re not sure about your entitlement, ask for a state pension forecast.
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In another change to state pensions in 2020, the increase in state pension age will continue. By October, men and women will have to wait until their 66th birthdays to claim state pension benefits for the first time. There will then be a standstill period, with the age due to rise again, from 66 to 67, between 2026 and 2028.
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