Tens of thousands of pensioners are missing out on valuable support that could boost their incomes by almost £2,000 a year – and get them help on council tax, TV licence and heating bills.
That’s through pension credits – which almost a million retired people are currently missing out on – despite being eligible.
The Government itself estimates that £1.7billion is currently unclaimed in pension credits - equating to roughly £1,700 per household.
Figures show that while 1.5million older people currently receive the financial help, there are still over 900,000 people who are eligible but have not yet applied, making it one of the most underclaimed benefits in the UK.
“Around 40% of people who are entitled to it don’t claim – which is about 1.3 million people,” Sarah Coles, finance analyst at Hargreaves Landsdown estimates.
“Many of them are managing on very low incomes, so it could make a real difference to their retirement,” she told The Mirror.
"In some cases, people don’t claim because they have worked throughout their lives and are reluctant to start claiming benefits, but it’s worth bearing in mind this is no different to your entitlement to a state pension: it’s part of what the state has agreed to pay you when you can no longer work.
“In other cases, people don’t claim because they don’t realise they’re eligible, so it’s worth knowing the basics,” Sarah added.
There are two components to pensions credit. You may be able to get the guarantee credit if you’re single and your weekly income is under £177.10 (or in a couple and your combined weekly income is under £270.30).
“The credit simply tops your income up to these levels," she said.
“The other aspect is the savings credit, which is for people who have saved a small amount for their retirement and who retired on the old state pension (by 5 April 2016).
“If you’re single this is worth up to £13.97 week, and if you’re in a couple, it could be worth £15.62 between you.”
Applying for the benefit also comes with additional help.
It could mean you’re also entitled to the Cold Weather Payment and a free TV licence if you’re over 75.
You may also not have to pay council tax, renters may get housing benefit, homeowners may get help with mortgage interest and service charges, and carers may get additional payments.
How much is pensions credit?
There are two elements of pension credits: guarantee credit and savings credit.
Guarantee credit is essentially a top-up for people on low incomes.
If you're single and your weekly income (including pension) is below £177.10, your income will be topped up to this amount.
If you're in a couple and your joint weekly income is below £265.20, your income will be topped up to £270.30.
The savings credit element can help top-up your retirement pot.
If you're single, savings credit is worth up to £14.04 a week.
If you're in a couple, savings credit is worth up to £15.71 a week.
Will I automatically get a free TV Licence?
If you're over state pension age, live in the UK, and earn less than £177.10 a week as a single person or £270.30 a week as a couple, including pensions, savings and work, then you could be entitled to a top up.
And those who qualify may be able to unlock thousands of pounds worth of additional savings, such as the free TV licence for over-75s.
As well as free access to TV, those who claim pension credits may also get a council tax reduction, £25 a week off their gas bills, free dental care and a £140 warm home discount to cover their winter bills.
Those who wear glasses may also qualify for vouchers worth up to £215 as well as housing benefit to help cover rent payments.
How can I apply?
The scheme, is run by the Department for Work and Pensions. To apply, your financial circumstances will have to be assessed.
It's largely available to those who live in the UK, have reached state pension age (your partner must be at state pension age too) and have less than £10,000 in savings (if you have more, you may get a reduced payment instead).
You can apply via Gov.uk if you've already claimed your state pension, but otherwise you'll need to phone the Pension Service on 0800 99 1234.
We've got a full guide on who can claim pension credits, here.
