In 2020 if you were on the full State Pension you would receive £175.20.
From April 6th 2021 the State Pension amount is increasing by 2.5%. This means recipients on a full state pension will now be receiving £175.20 per week (or £9,110.40 per annum).
This shows an increase in state pension for the tax year 2021/2022 are as follows:
Yearly increase: £228.80
Monthly increase: £17.60
Weekly increase: £4.40
If you are on the Category A or Category B pension you will be receiving £134.25 per week.
Your weekly pay will increase by £3.40 to £137.65 per week.
This shows an increase for Category A and Category B state pension for the tax year 2021/2022 as:
Yearly increase: £163.20
Monthly increase: £13.60
Weekly increase: £3.40
The triple-lock on State Pensions was created to ensure that your spending power will not decrease throughout the course of your retirement. Due to inflation and interest rates your spending power will decrease in retirement, so the UK Government’s guarantee (whilst it remains in place) helps you to maintain your buying power.
If inflation is below 2.5% your pension will increase greater than that meaning you have an increase greater than inflation.
There has been mounting social pressure to re-examine the triple-lock pension guarantee due to the significant cost to maintain it. It is suggested that removing the triple lock pension would save the tax payer over £4 Billion.
So, what does the triple lock pension mean? 🔒
The triple lock pension means that each April your pension will increase to which ever is the highest out of:
We’ve covered how much the State Pension is increasing by in April 2021, what this means for Category A/B and what the triple lock pension rule means.
For many, this increase will be welcomed news. It remains to be seen if the triple lock pension will be continued in the future.
If you’ve moved home and haven’t updated your address with your pension providers, check out this guide on pension change of address.