Increase Your State Pension By £54,000 Using These Three Tips!
This 2015 has been relatively friendly towards retirees and pensioners. Following April’s decision to give complete pensions freedoms for retirees, pensioners have the potential to increase their pension amounts by 50% if they correctly invest their money. Meanwhile, pensioners who don’t want to move their pensions accounts or withdraw their entire pension could boost their income by tens of thousands of pounds through these three simple steps!
Defer, Defer, Defer
State pensions can increase because of a short-term loophole from the UK government that allows a 62-year-old retiree who deferred their state pension for three years to boost their retirement income by £54,000 living up to the age of 90. The Department of Work and Pensions will contact you about how to receive your pensions as soon as possible. You may be presented with an instruction how to defer your pensions should you want to decide for it.
Deferring significantly boosts your pension in future years. When you defer, it is important that you still have a source of income, such as work you’re still strong enough to do or at least plenty of income to get you through the years.
When you defer for three years, you could fear inflation could devalue the amount you could receive. The truth is, inflation averages 3per cent every three years. If you have drawn your state pension right away, in three years, you could have had £6556 instead of £6000. You could also increase your state pension by 10.4 per cent on future payments for every year you defer. So, if you had £6000, you could have £8602 in your fourth year of deferral.
It may sound too good to be true, but it is no joke to defer. To live with income at such an old age would mean continuously working the same job you had post-retirement. That is, if your company still accepts your age and may present you with a waiver to allow you to continue work.
There is also a deadline. On April 6, 2016, the rate of return will come back to normal. If you turn 65 and withdraw after April 6, 2016, you only receive a less generous 5.8per cent increase annually rather than the 10.4 per cent.
So, the timer starts, now!