Unclaimed benefits to beat the budget

Some pensioners may not be claiming state benefits to which they are entitled, according to research conducted by Just Retirement Solutions (JRS).

The research, among the JRS customer base, shows that the average amount of additional state benefit to which retirees may be entitled is £675 per year. For those not claiming any benefits the additional amount identified was £788 per year. In a small number of cases, the additional benefits could exceed £2,400.

Nearly one in five (18 per cent) pensioners were eligible to claim state benefits where nothing had been claimed previously. One in four (26 per cent) of those currently claiming benefits are also entitled to additional benefits.

Stephen Lowe, of Just Retirement said:"Since the beginning of the recession, pensioners have been hit financially by higher taxes, spending cuts and inflationary pressures. Despite the fact that the Budget was less severe than expected, financial pressures for people in retirement have not eased. Considering these factors, it is disturbing that pensioners are not taking the state benefits that they are entitled to. For the majority of people, obtaining advice from an organisation or a person with an understanding of state benefits is the best way to ensure pensioners are not missing out on these valuable benefits. Just Retirement Solutions' equity release advisers start their advice process by reviewing customers' state benefits entitlements.

Taking an example of a pensioner who worked past the retirement age and suddenly became ill. He was unable to continue working and found it impossible to live on the basic state pension. He was topping up his income by stripping a small savings pot he had accumulated but knew this would run out soon. We identified that the pensioner could net savings of over £90 per month in council tax discounts and receive a pension credit of more than £500."

The latest Budget saw the Government propose the formation of a "single-tier" state pension system with weekly payments currently estimated to be around £140. Whilst this will simplify a complex system, the weekly payments will not help existing pensioners and will still leave many pensioners struggling to balance their budgets. A recent report from the Institute for Fiscal Studies, estimates that the median income for pensioners will fall by £460 a year between 2008-09 and 2011-12."

Further information about state benefits can be found by:

Going to a local Citizen Advice Bureau
Checking on the following website direct.gov.uk
Talking to a Financial Adviser