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The state pension is set to rise by 4.1% in April 2025 – more than double the September inflation rate of 1.7% announced today.
The rise, which is subject to official confirmation, is due to the triple lock formula.
Under this, pensions increase each April by the highest of three measures – earnings growth (the year-on-year rise in average earnings for the period May to July), price inflation for the year to September (which was announced this morning as 1.7%) or 2.5%.
The average earnings growth – which was recalculated as 4.1% rather than 4% – is the highest of the three.
This should mean the state pension will increase by 4.1% for 2025/26.
Aegon pensions director Steven Cameron said: “For someone on the full new state pension of £221.20 a week, this would equate to an increase of £9.10 to £230.30 a week, or £11,975.60 a year.
“For those who reached state pension age before 6 April 2016 and who are on the full basic state pension of £169.50, the increase could be around £6.95, bringing them to £176.45 a week – £9,175.40 a year.”
Cameron added: “A little-known rule is that any earnings-related element of the state pension, relating to the pre-April 2016 rules, and top-ups, are only increased in line with the rate of inflation and not the triple lock.
“Therefore, some may find their overall state pension increase lags behind the 4.1% figure.”
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