What are the financial perks of retirement?
When you finally reach retirement, it's not just a life without having to go to work you can enjoy. There are a variety of benefits, discounts and perks on offer once you reach a certain age.
Some are offered by the state - such as pension top-ups, help to meet the cost of energy bills or free and discounted travel. The crucial thing here is that more often than not you have to remember actively to claim them, as millions of UK consumers fail to do so, missing out on valuable income.
Others are available from private companies, covering everything from nights out at the cinema to discounts on sporting season tickets.
What pension and tax benefits can I claim?
Some 13 million people collect the state pension. How much you get will depend on the number of National Insurance contributions you've made during your working life, whether or not you were paying into the state second pension, and the year you qualified for the state pension.
You can find out the exact amounts in our guide How much state pension will I get?.
The state pension age is changing. Currently 66 for men and women, it will rise to 67 between 2026 and 2028 and thereafter to 68.
Pension credit tops up the state pension for people who are on a low income. Guarantee credit tops your weekly income up to £173.75 in 2020/21 if you’re single and £265.20 for a couple.
Savings credit, which has disappeared for those qualifying for the state pension on or after 6 April 2016, provides £13.97 for a single person and £15.62 for a couple per week.
You can apply for Pension Credit by calling the Pension Service on 0800 99 1234.
National Insurance cut
Once you've reached state pension age, you no longer pay National Insurance, even if you're still working.
This can see a significant cut in your annual tax bill. National Insurance is charged at 12% if you're an employee and 9% if you're self-employed, on income between £9,500 and £50,000, and 2% above. You can find out more in our guide to National Insurance rates.
Someone earning £30,000 a year would save £2,460 in the 2020/21 tax year. Use our income tax calculator to work out your bill.
National Insurance only applies to employment income - so if you retire before state pension age, and you only earn an income from pensions, you won't have to pay National Insurance.
What housing benefits can I claim?
If your savings are below £16,000 or you’re on a low income/claiming certain benefits you might be eligible for housing benefit. The most you can get is a 100% reduction, so it’s well worth applying for.
You’ll need to apply through your local council if you’re only making a new claim for housing benefit.
Help around the house
Age UK’s free Handy Van scheme is for over-60s with less than £20,000 in savings. It installs security systems and fits smoke alarms, to make you feel safer.
What energy benefits are there for over 65s?
Winter fuel payment
Winter fuel payments come in the form of a tax-free annual amount and just over 12 million people received them last year.
Retirees get it automatically if they receive the state pension or certain other benefits. The current rates are £200 per eligible household where the oldest person is under 80, and £300 for households containing someone aged 80 or over.
People now have to wait until they are older to receive the winter fuel payment.
Previously, the qualifying age to receive it was 60, but from 2010 this started to rise in line with the increasing state pension age for women. This means that you’ll need to be 65 to get the payment in winter 2020/21. The qualifying week for winter 2020 to 2021 is 21 to 27 September 2020.
|How much you get |
(if you were born between 28
September 1940 and 5 October 1954)
|How much you get |
(if you were born on
or before 27 September 1940)
|You qualify and live alone (or none of the people you live with qualify)||£200||£300|
|You qualify and live with someone under 80 who also qualifies||£100||£200|
|You qualify and live with someone 80 or over who also qualifies||£100||£150|
|You qualify, live in a care home and do not get certain benefits||£100||£150|
Cold weather payment
These are £25 payments for each seven-day period of very cold weather (average temperature in your area is recorded as being zero degrees Celsius) between November and March.
You’ll be eligible for it if you claim any other income-related benefits, such as:
- Pension Credit
- Income Support
- Income-based Jobseeker’s Allowance
- Income-related Employment and Support Allowance
- Universal Credit
What travel discounts can I claim?
Free bus pass
The age at which you’ll qualify for the free bus or travel pass varies across the UK.
While in Wales, Scotland, Northern Ireland and London you can get a pass for free travel when you reach 60, in the remainder of England you usually only become eligible for one when you reach state pension age.
Concessionary travel also allows some free travel on trains and ferries in Wales and Scotland (under the National Entitlement Card) respectively from age 60.
Londoners can get the 60+ London Oyster photocard at 60, which permits free travel on buses, tube, trams and London Overground, and then switch to the Freedom Pass at 65.
In Northern Ireland, those aged between 60 and 64 qualify for the 60+ SmartPass and then the Senior SmartPass when you reach 65.
The Senior Railcard, available to travellers aged 60 or over, is a widely-held retirement perk.
It costs £30 a year and enables you to get a third off standard and first class anytime, off-peak and advance fares.
What health and wellbeing benefits can I claim?
Disability Living Allowance/Personal Independence Payment
You can get up to £151.40 a week to help with the extra costs caused by a disability either under the Disability Living Allowance (DLA) or the Personal Independence Payment (PIP) which has now replaced it. Existing claimants are being moved from DLA to PIP.
If you’re 65 or over and do not get DLA or PIP, you'll need to apply for Attendance Allowance instead.
Benefits for carers
If you spend more than a certain amount of hours per week caring for a relative or friend, you could be entitled to government benefits. Read more about benefits for carers.
Visit Which? Later Life Care to read more on benefits and allowances for the elderly.
Free prescriptions and eye tests for over-60s
Once you reach 60, you can get free prescriptions and NHS sight tests in England. Prescriptions are free for everyone elsewhere in the UK (as are eye tests in Scotland).
You’ll also be entitled to free NHS dental treatment if you’re receiving pension guarantee credit.
Specsavers offers over 60s free eye tests and 25% off glasses and lenses from its £69 range or above, including designer styles.
Boots Opticians offer people aged 60 or over that have an Advantage card and are part of the More Treats for Over 60s scheme 25% off glasses or prescription sunglasses.
Find out more about how Which? rates optician stores.
Can I save money on entertainment?
Money off museum visits
Most museums offer concessions for senior citizens – English Heritage and National Trust both offer reduced memberships, too.
Cheap cinema tickets
Odeon, Vue and Empire offer cheaper cinema tickets to pensioners. Vue has Senior screenings for the over-60s, accompanied by a ‘cuppa and a biscuit’.
Empire has special Senior screenings for over-60s every Wednesday morning (tickets are £3.50), while Odeon holds weekly Silver Cinema screenings for over-55s on a Wednesday for £3. Both also provide free refreshments.
Discounted sports tickets
Older sports fans can get discounted matchday and season tickets for football, cricket and rugby games. The cheaper tickets are usually for those aged 65+.
Football season tickets for seniors can mean that you pay as little as £8 per Premier League match at the likes of West Ham United (senior season tickets from £160), Cardiff City (£169), Manchester City (£205) and Huddersfield Town (£249).
Older supporters of rugby sides Bristol Bears, Sale Sharks and Wasps can also secure decent savings against the full adult price, with over-65 season tickets at Bristol Bears costing as little as £140.
The table shows the cheapest seniors season ticket for the 20 clubs in the Premier League in 2018/19, and the level of discount you could get.
|Club||Cheapest senior |
season ticket price
|% of full |
|Brighton & HA||£350||68%|