It seems that 2021 was a great year for female pensioners, with pension increases closing the prevalent gender gap. For the last few years, men have received a significantly higher pension than women. However, a new report from Hargreaves Lansdown has revealed that the new State Pension is closing the gender gap. Here’s why now is a great time to be a female pensioner.
[top_pitch]
Why is the pension gender gap closing?
There is now clear evidence that the pension gender gap is closing. In 2021, women received an average of £164.74 per week compared to men who received £170.50. While a difference certainly remains, the gap is far smaller than it was just a few years ago.
The decreasing pension gender gap is the result of the new State Pension that is available to anyone who reached pension age from April 2016 onwards. According to Helen Morrissey at Hargreaves Lansdown, “The introduction of the new State Pension is good news for women retiring today as they close the gender gap in terms of how much they are receiving.”
The senior pensions and retirement analyst added, “Over time, in partnership with auto-enrolment, we will see more women building a resilient future for themselves in retirement.”
The new State Pension has allowed women across the UK to claim higher payments. As more eligible women are enrolled on the new State Pension, the gap is expected to close even more.
Women are still under-claiming Pension Credit
Although a rising number of women are able to claim higher pension payments on the new State Pension, many women on low incomes are still not claiming Pension Credit. This means that they are missing out on financial benefits that could help towards a more comfortable retirement. In fact, only 6 out of 10 people who are eligible for the extra money claim it!
Pension Credit is a benefit you can access if you have reached State Pension age. It’s designed to help those on low incomes with living expenses. The credit could increase your weekly allowance to £177.10 if you’re single or £270.30 if you’re part of a couple. This means that women could receive almost £13 extra per week if they are eligible.
Pension Credit comes with a number of added bonuses, including a free TV licence, and it helps with medical bills. Claiming Pension Credit could be a huge help with the cost of living constantly on the rise.
You may be eligible for Pension Credit if you are:
- A carer
- Severely disabled
- Responsible for a child or young person
You can still claim Pension Credit if you have savings or another form of income. However, Pension Credit is typically given to those on a lower income.
How to claim Pension Credit
Pension credit is separate from the basic State Pension and needs to be applied separately. You can begin your application up to four months before you reach State Pension age and will be able to apply anytime after you reach the eligible age.
The easiest way to claim Pension Credit is to apply on the egov.uk website. Alternatively, you can apply via phone or post. There are several documents containing information about your income and identity that you will need to hand when applying.
If you think that you may be eligible, Pension Credit could provide you with the extra cash that you need to survive the rising cost of living!
