State pension set to surge as wages jump 8.2% — how much you could get
The latest wage increase figures suggest state pensioners could get another large payment increase next April.
The annual growth in average pay has gone up 8.2 percent, above the rate of inflation, meaning this may be the metric used for the triple lock later this year.
Helen Morrissey, head of retirement analysis at Hargreaves Lansdown, said: “We may not see the eye-wateringly high increase in state pension that we saw last year but something in the region of seven percent is not out of the question.
“This would push up the full new state pension to more than £11,300 per year – if we were to see an increase in the region of 8.2 percent it would go up to around £11,470.”
The latest predictions suggest inflation will be at 6.9 percent in September so if the average earnings figure remains higher, this may end up determining how much payments increase next year.
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But it’s not all good news for state pensioners as these sizable yearly increases may not last for much longer.
Ms Morrissey said: “As the system continues to creak under pressure it’s time for a review of how the state pension works and the triple lock’s role within it.”
The full new state pension is currently £203.85 a week while the full basic state pension is £156.20 a week.
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Here is how much the weekly state pension would increase to with a seven percent or an 8.2 percent increase:
Seven percent increase
Full new state pension: £218.11
Full basic state pension: £167.13
8.2 percent increase
Full new state pension: £220.57
Full basic state pension: £169.
Steven Cameron, pensions director at Aegon, said: “If earnings growth remains above price inflation in the coming months, state pensioners may be winners, particularly as they are less likely to be affected by rocketing mortgage costs and could also be benefiting from higher interest rates on cash savings.”
The new state pension payments for each year are brought into effect from the start of the financial year.
A person can check how much state pension they are on course to receive using the state pension forecast tool.
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