State pensioners can add up to £916 extra into their pension pot with a little-known rule, but it does mean delaying your retirement for at least a year.
You can claim your State Pension once you reach State Pension age, which is currently 66 for both men and women. You’ll receive an invitation letter from the Pension Service around four months before you turn 66 and you can choose to either claim your pension, or defer it.
You must tell the Pension Service if you want to claim your pension as you won’t receive it automatically and if you choose this option, you’ll start to get your payments after you turn 66.
For those who get the basic State Pension, everyone eligible has already reached State Pension age so most will have already claimed it – unless you opted to defer.
The basic State Pension is given to men born before April 6, 1951, and women born before April 6, 1953, and the amount you get is dependent on your National Insurance (NI) qualifying years.
The full basic State Pension is currently worth £169.50 per week and to get this you’ll usually need 30 qualifying (NI) years if you’re a man born between 1945 and 1951, or 44 qualifying years if you were born before 1945. If you’re a woman, you usually need 30 qualifying NI years if you were born before 1950 and 1953, or 39 qualifying years if you were born before 1950.
It is possible to get more than the full basic State Pension if you choose to defer claiming it – but even if you’re already getting your pension, the government says you can still choose to defer, which can add a huge boost to your savings.
If you reached State Pension age before April 6, 2016, your pension will increase every week you defer, providing you defer for at least five weeks.
For every five weeks you defer, your State Pension will increase by the equivalent of 1%, which works out as 10.4% for every 52 weeks.
So if you get the full amount – which is currently £169.50 per week – by choosing to defer for 52 weeks, this will give you an extra £17.62 per week – amounting to £916.24 over the course of a year.
Of course, if there is an annual increase in the State Pension then the amount you can get could be much larger.
Chancellor Rachel Reeves confirmed in the autumn Budget last year that pension would be uprated by 4.1% in 2025, with Labour committing to the Triple Lock to protect pensioners in their retirement.
The 4.1% uprating will apply to both the basic and new State Pension in the 2025/26 tax year, with the new rates taking effect from April.
The uplift means that the full basic State Pension will go up from £169.50 to £176.45 per week, which is worth an extra £360 annually if you get the full amount.
