UK state pension fails to make top 10 highest paying state pensions in Europe
The UK state pension has been compared with other European equivalents to see which country provides the best value for money.
The full basic state pension currently pays £156.20 a week while people on the full new state pension receive £203.85 a week.
Payments increased 10.1 percent in April with state pensioners recently receiving their first full month of the uprated payments.
But many bills also went up in April, including energy and water bills, mobile and broadband, and council tax, adding to the pressure on pensioners’ budgets.
Almond Financial has compared the UK state pension with other state pensions across Europe to see who gets the most out of their payments.
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The analysis found Spain is the most cost effective country to live in as state pensioners get up to €2,617.53 (£2,287.24) each month.
This is over £1,480 more than a person on the full new state pension would receive each month.
As Spain has a relatively low cost of living at £561.43 a month, people on the state pension get very good value for their payments.
The UK came 16th in the table comparing state pension payments with the cost of living, with people on the full new state pension only just covering their costs, as they receive £802.32 a month and have average costs of £688.04 a month.
The situation for Britons may improve slightly from July when energy bills will drop by just over £400.
A typical household currently spends £2,500 a year on energy bills as Britons are protected from the market price of energy by the Government’s energy price guarantee.
But Ofgem announced today it will reduce the price cap from July, meaning a typical household will pay £2,074 a year.
But prices continue to climb for other daily essentials with food inflation at 19.1 percent while overall inflation is at 8.7 percent.
These are the top 10 countries with the highest paying state pension:
- Luxembourg – £3,050
- Belgium – £2,709
- Spain – £2,287
- Switzerland – £2,123
- Liechtenstein – £2,061
- Denmark – £1,647
- Norway – £1,579
- Iceland – £1,524
- France – £1,497
- Cyprus – £1,485.
The country with the highest state pension is Luxembourg, where pensioners get up to £3,050.57 a month, with the monthly cost of living at £847.32.
The worst ranked country was Armenia, where the state pension is just £67.79, despite monthly living costs of £506.81.
The country with the highest cost of living was Switzerland, where people pay £1,276.40 a month for their basic needs.
However, the country came sixth in the table as state pensioners get a monthly payment of £2,123.54.
Albania has the lowest cost of living, at £386.45, but the state pension only covers about two thirds of this, paying £263.13.
Sam Robinson, principal financial adviser at Almond Financial, said: “The UK has a system that is just above the breakeven point which means at present, there isn’t much room to manoeuvre for those battling the cost of living crisis.
“And while it is positive that the UK finds itself among the top half of countries, for how much longer is the question.
“While the increase in state pension in line with inflation is needed and welcomed, it’s clear that those over 66 need to look at other options rather than just relying on the State Pension.
“Planning for life after work is crucial and it’s important to seek advice from a pension advisor if you aren’t sure where to start.”
Published at Thu, 25 May 2023 09:50:00 +0000