Thousands of people increased their State Pension payments last year by delaying when they first claimed the benefit, new figures show.
Nearly 42,000 individuals chose to postpone drawing their pension in the 2023/24 financial year, securing higher weekly payments as a result.
Data obtained by Royal London through a Freedom of Information request shows 41,938 people collected a deferred State Pension during the year.
While this represented a drop of more than a fifth compared with the previous year, when 54,037 people delayed their claim, those who waited were rewarded with significantly higher payments.
On average, claimants had waited four years before finally accessing their pension, resulting in roughly £50 extra each week.
The data revealed a remarkable group of “super-postponers” who had waited more than three decades to claim their entitlement. Among the 25 longest deferrals, the average delay stretched to 32 years, with these individuals first becoming eligible for their pension back in 1991/92.
At that time, men qualified at 65 whilst women could claim from 60, meaning many of these extreme deferrers would now be in their nineties, with some potentially centenarians.
Some 591 people had held off claiming for 20 years or longer, whilst 4,435 had delayed by at least a decade.
Those who began deferring before the new State Pension launched on 6 April 2016 benefited from considerably more favourable terms, receiving a 10.4 per cent annual uplift for as long as they postponed.
Postponing the State Pension offers several potential benefits for those able to manage without the income initially.
Following pressure from campaigners and government, the UK’s major high street banks
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GETTYThe 5.8 per cent annual increase translates into permanently higher weekly payments, providing greater income throughout later retirement.
Additionally, because yearly rises under mechanisms like the triple lock are calculated as a percentage of the existing amount, starting from a larger base means each subsequent increase delivers more money in absolute terms.
For individuals still earning at State Pension age, deferral can prove particularly advantageous from a tax perspective.
Drawing the pension alongside a salary typically pushes recipients into paying income tax on their State Pension, so holding off can reduce the overall tax burden during peak earning years.
Drawing the pension alongside a salary typically pushes recipients into paying income tax on their State Pension
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GETTYOne in four deferrers, totalling 10,656 people, had postponed for five years or more.
Despite the appeal of enhanced payments, deferral carries significant risks that vary depending on individual tax circumstances.
Someone postponing for a year from January 2026 would forgo nearly £12,000 in State Pension payments, assuming full entitlement, in exchange for receiving £243.60 weekly in 2027 plus any triple-lock adjustments.
The mathematics work out differently depending on tax status.
Basic rate taxpayers would need to survive until approximately 82 to recoup their foregone income,
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GETTYBasic rate taxpayers would need to survive until approximately 82 to recoup their foregone income, whereas those earning above £50,270 would break even by age 79.
Sarah Pennells, Consumer Finance Specialist at Royal London, said: “If you’re thinking of delaying claiming your State Pension, then it’s a good idea to assess whether it is right for you.
“Getting the extra money may look attractive, but you are giving up the right to receive any State Pension payments until you stop deferring, and it could take years to see the benefit. The less tax you pay, the less worthwhile delaying might be.”
