Could your parents, grandparents or relatives be eligible for more financial help than they are getting?
60% of pensioners who own their own home are missing out on at least £1,000 in state benefits each year, according to research from Just Group. This is due to the mistaken belief that being a homeowner makes them ineligible for certain benefits.
Overall, 88% of pensioner couples and 63% of single pensioners own their own homes. According to the research:
- 42% of those who could claim state benefits are not claiming any financial help at all
- 19% are receiving state benefits, but are eligible to claim more assistance
If you think someone you know could be one of them, now is the time to give them a helping hand.
Which benefits are affected?
There are many types of state benefit available to pensioners. However, it can be confusing to know which assistance is available in conjunction with others and that can lead to people receiving less help than they should be getting.
The study shows that 30% of homeowning pensioners are receiving one kind of state benefit whilst missing out on at least one other.
Pension Credit seeks to top-up the income of those living on less than £159.30 per week (single) or £243.25 per week (couples). It is split into two streams:
Guarantee Pension Credit: For those who receive less than the above amounts in weekly income, the Guaranteed Pension Credit provides additional money for essentials. 9% of homeowning pensioners are eligible to claim this benefit, but only 63% of those, do so. With each new claim worth an average of £3,431, that’s a lot of people living on less than they need to.
Savings Credit: This applies where the person had personal savings which were designated to support their retirement lifestyle. Unfortunately, this is the least-accessed benefit among those who are eligible for it at just 35%. On average, many people could be £275 better off each year by accessing Savings Credit.
It might not sound like much on its own, but with 25% of pensioners struggling to make ends meet (Source: Age UK), even the small amounts could make a big difference.
1.4 million eligible families failed to claim either type of Pension Credit in 2017, losing a combined £3.3 billion; an average of £2,000 per family.
Less than half (45%) of those who are eligible to claim Council Tax Reductions have done so, leaving many paying an unnecessary £491 each year.
16% of pensioners who own their home are entitled to other benefits including:
- Universal Credit
- Disability living Allowance
- Personal Independence Payments
- Jobseekers Allowance
- Industry Injury Benefit
Those who don’t claim this assistance are missing out on a further £1,000 per year.
(source for the above: Just Group)
How much is being lost?
The amount lost due to unclaimed benefits varies and it can be easy to think that you don’t need an extra few hundred each year, but with some statistics showing that thousands of pounds have gone unclaimed, can you really afford to miss out? Further still, could your relatives benefit from that extra cash?
Unclaimed Guarantee Pension Credit can be worth up to:
- £8,286 for a single person
- £12,352 for couples
On average, each household with unclaimed benefits is losing out on £1,013 per year. Of those who are eligible to claim:
- One in four lose over £1,000
- One in five lose £500 – £1000 a year
- Half miss out on at least one benefit
- One in 10 have two benefits unclaimed
The largest amount of lost benefit was £7,142 a year.
How can you help?
One of the main issues is the push for services to be accessed online. Whilst some older people are very tech-minded, those who struggle to understand the internet could find it harder to access the right pension and navigate the online applications.
The second issue is understanding the complex rules surrounding benefits and pensions. The biggest misunderstanding among homeowning pensioners is that they will not be entitled to claim financial assistance due to owning property, which is simply not true.
What can you do?
- Talk to older relatives about their benefits. Though some may still feel uncomfortable discussing their finances, it may help them to know that extra help could be available for them
- Help navigate the online world with them. It might take patience, but even some basic tech lessons could help them to access the financial help they need in later life
- Read information and explain what their options are
- Do the applications on their behalf, if it is appropriate to do so
- Help them to access free services, including Citizen’s Advice
- Go with them to talk to a financial adviser. If you do not feel able to confidently understand what is available, you can accompany your relatives to an appointment with their financial adviser to get impartial, tailored advice to suit their needs
And if they don’t already have a financial adviser? Give us a call.