A boost for pensioners could be a good deal for many people, expert Stuart Haigh said this week.
Stuart, a director at Whitley Stimpson, the leading accountancy and business advisers with offices in Bicester, Banbury and High Wycombe, said: “A new scheme announced by the Government whereby pensioners can buy more pension is, in the main, a much better deal than annuity deals being offered by private pension companies.
“However, the Department of Work and Pensions Is advising people to get financial advice and we are well placed to help in this respect.”
The Government scheme is open to anyone who is already receiving a state pension or is due to receive one before 6 April 2016, which means that men are eligible if they were born before 6 April 1951 and women are eligible if they were born before 6 April 1953. It has been launched to compensate such people as they will not be eligible for the new and generous flat rate pension starting in April 2016.
The maximum people can get Is £1,300 a year, or £25 a week, which will be paid on top of the present state pension of £115 a week.
Stuart said: “How much people get depends on their age. There is a one-off payment which they will not get back but the deal for most people is extremely good.”
He said for someone aged 65 the one off payment would be £22,250 in comparison to £35,215 to a private sector annuity and the return, which increases annually in line with the Consumer Price Index. For someone aged 80 the one-off payment is £13,800 compared to £18,800 from a private sector annuity.
Stuart added: “The actual deal is dependent on personal matters, such as whether people are on means-tested benefits and those with incomes that require a forty per cent income tax payment. Women who do not have a full national insurance contribution record may be better off claiming payments from another scheme. Applications can only be made for 18 months from October this year and anyone applying is required to register with the Department of Work and Pensions.
Anyone needing advice can contact Stuart Haigh on 01869 252151 or by email firstname.lastname@example.org