The full new state pension is now worth £241.30 a week (£12,547.60 a year) but not everyone receives this amount
Living on the state pension alone is becoming “increasingly difficult” to live on as prices continue to rise due to the Iran war.
The full new state pension is now worth £241.30 a week (£12,547.60 a year) but not everyone receives this amount. Your state pension entitlement is based on your National Insurance record.
You typically need 35 years’ worth of contributions to get the full new state pension – and a minimum of ten years to get anything at all.
There are also people who get the older basic state pension, which is worth less at £184.90 a week (£9,615 a year).
Royal London research estimates 12% of adults over state pension age rely solely on the state pension, with 16% of women and 8% of men having no other income in retirement.
Sarah Pennells, consumer finance specialist at Royal London, said: “For many pensioners, living on the state pension alone is becoming increasingly difficult.”
She added: “Hundreds of thousands of those who get the new state pension don’t receive the full amount.
“For those who do get the full new state pension, the £241.30 payment works out at less than £35 a day. That’s not a lot to pay for food, heating, energy and council tax.
“However, twice as many pensioners are on the old basic state pension system, and, while some will get a much larger weekly payment thanks to the state second pension, those on the basic state pension will only get £184.90 a week.
“While the state pension has risen in cash terms, the cost of everyday essentials like food, energy, housing and council tax is still far higher than it was before the cost-of-living crisis, and these are bills people simply can’t avoid.“
The war in Iran has led to oil prices soaring, which has already had a knock-on effect on fuel costs.
The average cost of a litre of unleaded petrol stood at 158.0p on Thursday, up 25.2p or 19% since the start of the Middle East conflict. A litre of diesel now averages 191.1p, up 48.7p or 34%.
The war is also forecast to cause a surge in energy bills this summer. Analysts at Cornwall Insight currently expect the Ofgem price cap will soar to £1,929 a year for the typical home this July.
Mortgage rates have gone up as well, amid reduced confidence of interest rates being cut this year.
The average mortgage rate on Thursday morning was 5.89% for a two-year fix and 5.77% for a five-year fix, according to Moneyfacts.
Rebecca Lamb, external relations manager at Money Wellness, urged people to check what help is available to them, including Pension Credit.
Pension Credit is available to people above state pension age who are on low income. The main part of Pension Credit is known as “Guarantee Credit” and this tops up your weekly income to £238 if you’re single, or to £363.25 if you’re in a couple.
said: “Pension Credit remains one of the most under‑claimed benefits in the UK, with around 910,000 eligible households not claiming it, meaning people are missing out on roughly £2,600 a year on average plus access to other help like housing and council tax support. For thousands of pensioners this extra income could ease pressure on tight budgets.
“Given rising costs and the rising incidence of fuel poverty among older people, it’s vital that pensioners and their families are aware of what they’re entitled to and get support to access it, as every pound matters when you’re on a fixed income.”
