Later Life

Majority of retired homeowners missing out on full benefits entitlement

Rozi Jones
8th January 2018
Gender wage pay gap retirement income man woman money
"About four in 10 were eligible to receive one or more benefits, but that 61% were either not claiming anything or claiming and receiving too little."

Six in ten pensioner homeowners are missing out on hundreds – in some cases thousands – of pounds of extra income by failing to claim their full State Benefits entitlement, according to Just Group research.

It found that of pensioner homeowners entitled to receive benefits, four in 10 (42%) are failing to claim anything and two in 10 (19%) are claiming but receiving too little.

Overall one in four of those eligible were missing out on more than £1,000 a year and one in five were missing out on between £500 and £1,000 a year. Half of those eligible were missing out on at least one benefit and one in 10 were missing out on two benefits.

The largest amount of lost benefit was £7,142 a year for a 64-year-old in Norfolk. The oldest client was a 98-year-old from East Anglia who was missing out on nearly £410 a year Council Tax Reduction.

The most recent official figures suggest around 1.4 million families – more than in 2015/16 – who were entitled to receive Pension Credit (either Guarantee or Savings) did not claim the benefit, to a total cost of £3.3 billion or £2,000 per family. Overall, about 88% of pensioner couples and 63% of single pensioners own their own homes.

Stephen Lowe, group communications director at Just Group, said: “At a time when many pensioners are struggling for income and inflation is rising, we have once again found far too many are missing out on State help. The shortfall can be thousands of pounds a year that would make a massive difference to people’s lives.

“One of the first tasks when meeting clients is for the adviser to check their entitlement to benefits. We found about four in 10 were eligible to receive one or more benefits, but that 61% were either not claiming anything or claiming and receiving too little. That’s a little lower than recent years, but still a cause for concern.

“In 2017 the average value of benefits underclaimed rose sharply to £1,013. Of the benefits we track, it is Guarantee Pension Credit which displays the biggest unclaimed sums, perhaps because it can be worth such a significant sum – up to £8,286 a year for a single person and £12,352 for a couple.

“One in three of those eligible for Guarantee Pension Credit failed to claim with an average loss of £3,431. All of those not claiming this benefit were missing at least £1,000 a year and in one case the loss was £8,060 a year.

“Savings Pension Credit is actually the least likely benefit to be claimed with an average unclaimed value of £275 a year. Council Tax Reduction is another area of concern where fewer than half of those eligible are claiming and the average amount being lost is £491 a year.

“The figures make clear that in a complex system people are struggling to get to grips with what State Benefits they are entitled to. It strengthens the case for making free guidance the default option for all those heading into retirement – unless they specifically opt out – and that guidance should include information about entitlements to State help.

“It is possible that homeowners in particular may think limited support is available, although owning a property does not necessarily mean you have adequate income in retirement.

“That may explain why four in 10 who could get help are failing to claim any benefit. Equally worrying is that of those who are getting one benefit, nearly three in 10 of them are missing out on at least one other benefit.”

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