Making the decision to retire is not always easy; especially when trying to work out whether you can afford to stop work.
If you’ve retired already or are planning to and are wondering what financial help could be available to you, here’s what you need to know.
State Pension
Whether or not you have access to the State Pension and how much you receive from it will depend on how many years you’ve been making National Insurance Contributions (NICs).
If you live in the UK and you’ve paid National Insurance here for at least 10 years, then you will usually qualify for some state pension.
If you’ve paid National Insurance for 35 years or more, then you should be eligible to receive the full state pension, which in the 2019/20 tax year is £168.60 per week, rising to £175.20 in the 2020/21 tax year. Find out more about the State Pension in our article How the State Pension works.
Pension Credit
If you’re on a low income during retirement, then you may be able to boost what’s coming in with Pension Credit. Many people who are eligible to receive Pension Credit don’t claim it – so make sure you don’t miss out if you are.
Pension Credit have two parts:
- Guarantee Credit
- Savings Credit
Guarantee Credit will give you an additional weekly income of a guaranteed amount of £167.25 if you’re single, or £255.25 if you’re married or in a civil partnership.
Savings Credit is given to people of qualifying age who have contributed other provisions or savings other than the basic State Pension. Savings Credit will provide an additional income of £13.73 a week for a single person, or £15.35 if you’re married or in a civil partnership.
But, in order to qualify for savings credit you must have reached State Pension age on or after 6 April 2016.
Additional Pension Credit is also awarded in special circumstances. You may be eligible for a larger benefit amount if:
- You’re disabled
- You a carer
- You’ve got certain housing costs to cover e.g. mortgage interest payments.
To find out more, read our article Pension Credit explained.
Council Tax reduction
Although Council Tax Benefit was abolished on 1 April 2013, your local council might still be able to help you with your Council Tax bill. It’s best to contact them directly and ask what help may be available to you.
For example, if you’re the only adult living in your home, you’ll be eligible for a 25% discount on your Council Tax bill.
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