Are your clients losing valuable income?
According to recent research, hundreds of pounds worth of income is being lost as pensioners are not claiming their entitled benefits in full.
Just data has indicated that six out of 10 pensioner homeowners who are eligible for benefits have failed to claim the entirety of their State Benefit Entitlement, or are getting less than they should.
Growing from a quarter to a third, this represents the third consecutive rise in the number of individuals claiming in some respect but receiving an amount lower than their full entitlement.
An average of £576 could be lost annually by those who are failing to claim, although in one particular case, the amount lost reached £2,330.
However, the data also indicates that around seven out of 10 eligible couples are claiming, meaning that this demographic are more likely to claim for benefits in comparison with those who are single.
The figures also show that 75% of eligible over-75s are claiming compared to 56% of those in the 65-74 age band. The figure drops further to 43% for those aged between 55-64, indicating that the older generations are more likely to take-up benefits.
With take-up reaching around 85%, Guarantee Pensions Credit is the most likely benefit to be claimed by those who are entitled to it. An annual average of £572 is being missed out on for those who are not claiming. However, over one in four individuals who are claiming do not receive the full amount they are entitled to, which in one instance totalled £1,059 per year.
Of those who were eligible, Savings Pension Credit was only claimed by 39%, with those not making a claim missing an average of £431 per year. The largest loss was an annual total of £906.
The average yearly loss for those failing to claim Council Tax support was an annual £529. The benefit is being claimed by just under half of those who are eligible (49%), with the biggest sum missed out on totalling £1,810 per year.
Commenting on the statistics was Stephen Lowe. The group communications director at Just highlighted the importance of benefit take-up and the current low figures.
“This is the seventh year we have carried out this research and the seventh time we have issued the same warning. Take-up rates are far too low and it is costing pensioners dearly, in some cases several thousand pounds a year.
“Pensions and benefits are now so complex that few retirees understand all the options without professional help and it is costing them dearly. Take-up rates of State benefits are lower among homeowners than non-homeowners. Yet owning bricks and mortar doesn’t mean you are not struggling financially.”
He also brought attention to the need for a default option in regards to free pension guidance and the potential benefits that people could be missing out on if they are failing to claim.
“It’s interesting that the largest amount of ‘missing’ benefit we found was £2,330 which was for a 92-year-old in the Midlands, who was not claiming any benefit until our adviser crunched the numbers and found she should be receiving £45 a week. We can’t tell exactly how much she missed out on over the years but it could be in the tens of thousands of pounds.
“About one in 10 of those eligible to claim were missing out on more than £1,000 a year with nearly half not claiming any benefit at all. And another two in 10 were missing out on between £500 and £1,000 a year.
“These are life-changing amounts of money which in many cases are not being claimed by those who are struggling the most. Even once in the system, people have to take care they are claiming the correct amount.”