The government has today (12 October) launched its state pension top up scheme, with men aged 65 or older and women aged 63 or older being offered a chance to increase their pot by up to £25 a week.
This applied to anyone reaching state pension age before 6 April 2016 and will remain open for 18 months, with potential top ups worth £1,300 a year.
In most cases, surviving spouses and civil partners will be able to inherit at least 50 per cent of the extra pension.
Minister for pensions Baroness Ros Altmann explained the government has already committed to protecting pensioner incomes with the triple lock – uprating the basic state pension by at least 2.5 per cent each year of this parliament.
She said: “Top up is an opportunity for people already retired, or reaching State Pension age before April 2016, to boost their later life income.
“It won’t be right for everybody and it’s important to seek guidance or advice to check if it’s the right option for you, but it could be particularly attractive for those who haven’t had the chance to build significant amounts of state pension, particularly many women and people who have been self-employed.”
The cost of a state pension top up is based on a person’s age and takes average life expectancy into account.
For a 65-year-old, an extra £10 of pension a week will cost £8,900 whereas for a 75-year-old the contribution rate for the same amount of pension is £6,740.
peter.walker@ft.com
