Pensions in Great Britain will increase by 4.7%: how much recipients will receive.

According to The Sun: It has become known how much your state pension will increase. Find out how to check your increase.

According to the triple lock system, the state pension is increased each year by the rate of inflation for September, by 2.5%, or by the growth of average salaries from May to July – the highest figure will be used.

Yesterday, data from the Office for National Statistics (ONS) showed that total pay, including bonuses, for the three months up to July was 4.7%. This figure will be the basis for the annual increase.

However, there are several factors that influence the amount of your monthly payment.

Expected pension increase

The new fixed amount of the state pension for those who reached retirement age after April 2016 is expected to be £241.05 per week.

This will mean an increase of £10.65, leading to an annual total payment of £12,534.60 - £561.60 more than now.

The old basic state pension will also rise to £184.75 per week, which means an annual increase of £431.60.

However, to receive the full pension amount, one needs to have a sufficient number of National Insurance (NI) contributions.

National Insurance is an income tax paid by employees and entrepreneurs. It funds various social payments, including the state pension.

To receive the full pension, one must have 35 years of NI contributions. Currently, they are valued at £230.25, but will rise to £241.05 in April next year.

A minimum of 10 years of contributions is required to receive any amount of state pension.

There are various reasons why there may be gaps in contributions, for example, time spent raising children.

Buying contribution years

Fortunately, it is possible to buy years or use free credits to make up your contributions.

If you have not yet reached retirement age, check your state pension forecast at www.gov.uk/check-state-pension to find out if it is beneficial for you to make voluntary contributions.

You can also contact the Future Pension Centre at 0800 731 0175.

If you are already a pensioner, contact the Pension Service to find out if it makes sense to pay voluntary contributions.

There are various ways to reach this service, including visiting the website www.gov.uk/contact-pension-service.

How much does it cost to buy back years

The cost of buying back National Insurance contributions has its price.

For example, filling a missed week of contributions for the tax year 2024/25 will cost £17.45 or £907.40 for a full year.

Prices may vary from year to year: in 2021/22 filling a week cost £15.50 or £800.80 per year.

Generally, you can pay voluntary contributions for the past six years until April 5 each year.

For example, by April 5, 2030, you can make up gaps for the tax year 2023/24.

CHECK NATIONAL INSURANCE PAYMENTS

Before making voluntary contributions, it is important to find out if you can make up gaps in your contributions using free NI credits.

Thousands of people are believed to be missing out on these NI credits, which complicate their financial situation in retirement.

For example, those receiving certain types of benefits need to qualify for class 1 credits.

This includes parents who have active applications for children’s contributions.

You can find a complete list of eligible individuals for credits at www.gov.uk/national-insurance-credits/eligibility.

It also states when to apply and when it happens automatically.

In the context of the ongoing increase in pensions, it is important not only to know about changes but also about opportunities that can help you secure more in retirement. Checking contributions and accessing free credits can significantly impact the amount of your pension, so do not leave this matter unattended.

Think about your future pension today and don’t miss the chance to have financial stability in your retirement agreement.