MARTIN Lewis’ MoneySavingExpert.com (MSE) has issued a warning to anyone earning less than £220 a week.
In the latest MSE newsletter, the team encouraged people on a low income to check if they qualify for pension credit.
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It said: “If you’re over 65 and have an income of less than £220 a week (or £320 if you’re a couple), it’s worth checking if you’re due pension credit.
“It can be worth £1,000s a year, but more than 800,000 pensioner households who are eligible don’t claim.”
It comes as one MSE reader wrote in to say her mum is now saving an extra £5,000 a year.
Happy customer Debbie wrote in and said: “My mum’s finances changed when my dad went into a care home.
“So after I read your blog, I applied online for Pension Credit for mum.”
As a result, Debbie’s mum is now saving nearly £5,000 a year as she’s getting £4,800 in pension credit payments, but also a free TV licence and has cut the costs of other bills by switching to social tariffs.
She added: “It really pays to apply.”
You can check if you qualify for pension credit, just phone the helpline on 0800 99 1234 or on the government website.
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You can start your application up to four months before you reach state pension age.
If you’re already on pension credit or are going to apply, then you can also see if you can get a free TV licence.
This could save you £159 a year on fees.
You can apply for the discount on the TV licensing website or by calling 0300 790 6117.
On top of that, Brits can also save money by switching to a social tariff.
You’ll need to be on a low income or on certain benefits but it could save you up to £200 a year.
Providers offer different packages, so it’s worth shopping around for the best deals.
You can check other prices on the market by using comparison websites such as moneysupermarket.com or Uswitch.
Who is eligible for Pension Credit?
It is available for people who are over the state pension age, and who live in England, Scotland or Wales.
This is currently rising to 66 for both men and women.
It used to be the case that couples, where one person was over state pension age, could claim, but new rules now mean that both people in a couple must be over retirement age to apply.
This means if you’re single and move in with a partner who is younger than the State Pension age, you will stop being eligible.
But if you’re already receiving Pension Credit under the old system it won’t stop unless your circumstances change.
To qualify, you’ll need to have a weekly income of less than £201.05 for single people or £306.85 for couples.
Your income is worked out taking into account various elements including:
- Your state pension
- Any other pensions you have saved, for instance, workplace or private pension savings
- Most social security benefits, for example, carer’s allowance
- Any savings or investments worth over £10,000
- Earnings from a job
The calculation does not include:
- Attendance allowance
- Christmas bonus
- Disability living allowance
- Personal independence payment
- Housing benefit
- Council tax reduction
If your income is too high to get Pension Credit, you may still get some savings so it’s worth checking.
How much can you get in Pension Credit?
There are two parts to the benefit and pensioners can be eligible for one or both parts – here are the current rates for the tax year:
- Guarantee credit – tops up your weekly income to a guaranteed minimum level. This is £201.05 a week if you’re single and £306.85 a week for married couples.
- Savings credit – provides extra money if you’ve saved money towards retirement. You can get an extra £15.94 a week for a single person or £17.84 a week for a married couple.
You may also get additional pension credit if you are disabled, have caring responsibilities or have to pay certain housing costs such as mortgage interest payments.
For instance, you can get either £61.88 a week or £72.31 per week for each child or young person you’re responsible for.
If you are disabled or care for someone who is disabled, you may get more.
For example, if you have a severe disability you could get an extra £76.40 a week or if you care for another adult you could get an extra £42.75 a week.
How do I apply?
You can start your application up to four months before you reach state pension age.
Applications for Pension Credit can be made on the government website or by ringing the claim line on 0800 99 1234.
You can get a friend or family member to ring for you, but you’ll need to be with them when they do.
You’ll need the following information about you and your partner if you have one:
- National Insurance number
- Information about any income, savings and investments you have
- Information about your income, savings and investments on the date you want to backdate your application to (usually 3 months ago or the date you reached state pension age)
If you claim after you reach pension age, you can backdate your claim for up to three months.
Do I need a TV licence?
If you want to watch or record live TV then, yes, you need a licence.
This includes recording it live and watching it later.
Live TV includes all programmes on any channel, including soaps, series, documentaries and even movies.
In addition, the rules apply even if you don’t watch the shows on an actual TV – for example, if you watch programmes that are being broadcast live on a PC, laptop, tablet or phone.
A colour TV licence currently costs £159 a year. A licence for watching a black and white TV costs £53.50.
You’ll need to apply for a free licence on the TV licensing website or call 0300 790 6117.
Do you have a money problem that needs sorting? Get in touch by emailing [email protected].
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