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Revealed: which towns boast the UK’s richest pensioners?

Highest average pension income found in London and the South East

Revealed: which towns boast the UK’s richest pensioners?

New data from HM Revenue & Customs (HMRC) has revealed where pensioners in the UK receive the highest and lowest incomes. 

The figures are based on the UK’s 31 million taxpayers and count all forms of taxable pensions income, including State Pension, workplace pensions and private pensions.

Which? takes a look at the top and bottom 10 local authorities for pension income in the UK.

UK’s richest pensioners

The highest earning pensioners are in London and the South East, according to personal income statistics for the 2015-16 tax year, recently released by HMRC.

The City of London came out on top, with retirees receiving an average pension income if £37,900.

The second and third richest pensioners lived in Westminster and Kensington & Chelsea, receiving £29,500 and £26,700, respectively.

Outside of London, the best-earning retirees live in South Bucks, with an average income of £26,000, followed by Elmbridge at £25,900.

The graphic below shows the top 10 local authorities with the richest pensioners for the 2015-16 tax year.

UK’s poorest pensioners

While the wealthiest retirees were clustered in the south-east of England, those pensioners with the lowest income were spread throughout the UK.

Stoke recorded the poorest pensioners, with retirees receiving an average pension income of £12,300, according to the HMRC report.

The London Borough of Barking and Dagenham was the second poorest local authority, with pensioners receiving an average of £12,800.

Hull came in third, with retirees receiving an average income of £12,900, while Sandwell and Southampton came in fourth and fifth, with pensioners earning an average income of £13,000 and £13,100, respectively.

The graphic below shows the UK’s bottom 10 local authorities with the poorest pensioners for the 2015-16 tax year.

What’s the average pension income in my local authority?

If you want to see the average pension income for your local authority, simply type it into the table below.

How can I boost my pension?

When planning your retirement, it pays to start as early as possible.

But whether you’re at the beginning of your career or looking to retire soon, here are four top tips to boost your pension income.

1. Check your state pension

It’s important to check your state pension to determine if and how much you’re likely to receive when you reach state pension age. You can get your state pension forecast online at Gov.uk.

In 2018-19, the full level of the new state pension is £164.35 a week (£8,546.20 a year), up from £159.55 a week (£8,297 a year) in 2017-18.

2. Apply for National Insurance credits

People with no National Insurance record before 6 April 2016 will need 35 qualifying years to get the full amount of new state pension, and will need at least 10 qualifying years to get any new state pension at all.

National Insurance credits contribute to your National Insurance record when you’re not working for a specified reason – for example, if you’re unemployed, caring for children, ill or disabled, taking an approved training course or doing jury service.

The credits go towards building qualifying years for your state pension and could help boost your final entitlement.

Many credits are applied automatically, but some need to be claimed from HMRC.

3. Top-up your state pension

If there was a period in which you did not pay enough National Insurance contributions or get enough National Insurance credits for a full qualifying year, you may have a gap on your National Insurance record.

These gaps could result in you missing out on the full state pension. To avoid this, you can top up your record by making Voluntary ‘Class 3’ National Insurance Contributions.

The deadline to pay is 5 April each year. For further details on how and when to pay check Gov.uk.

4. Maximise your employer contributions

If you increase your contributions to a workplace pension or private pension, some employers will also boost the amount they contribute.

The table below shows the minimum employer contributions, but some employers may offer more generous terms – so it’s worth checking to see if you could get a boost by increasing your own payments.

Date Employer minimum contribution Total minimum contribution
Until 6 April 2018  1% 2% (including 1% staff contribution)
 6 April 2018 – 5 April 2019 2% 5% (including 3% staff contribution)
 6 April 2019 Onwards 3% 8% (including 5% staff contribution)

For more tips on how to increase your retirement earnings take a look 21 ways to boost your pension in 2018.

You can also check out our short video on how retirees have approached saving for their retirement.

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