The State Pension increased once again for the 2025/26 tax year, thanks to the ‘triple lock’. And while this provides a welcome boost for millions, the real question for those approaching or in retirement is whether the State Pension alone can sustain the lifestyle they aspire to.
For many, the answer will unfortunately be ‘not without additional pension savings’. According to the Retirement Living Standards, the maximum State Pension (£230.25 a week/£11,973 a year) falls £1,427 short of the minimum income bracket of £13,400 for a single person at retirement age.
This minimum tier is defined as covering ‘all your needs, with some left over for fun’, but it does assume the person’s mortgage has been paid off by that time (if not, more would be needed to cover rent/mortgage costs). So, understanding the triple lock is just the beginning of planning a financially secure retirement.
In this article, we’ll delve into what the triple lock is, how it works, and explore its implications for the future. We’ll also discuss alternative ways to boost your retirement savings, such as SIPPs (Self-Invested Personal Pensions), and why taking control of your retirement plan now is more important than ever.
Jump to:
- What is the triple lock
- State pension increase 2025/26
- Who qualifies for the state pension
- Understanding your retirement income
- Planning for retirement: beyond the State Pension
- Conclusion
What is the triple lock
The triple lock is a government policy designed to protect the value of the State Pension against inflation.
Introduced in the 2011/12 tax year, the principle is that the State Pension should increase annually based on whichever of the following three things is highest:
Wage growth
The average earnings increase across the UK (measured from the previous July until the following May).
Inflation
As measured by the previous September’s Consumer Prices Index (CPI).
Or 2.5%
This flat rate is applied, unless either wage growth or inflation is higher than 2.5%.
The triple lock applies to both the basic State Pension (the older version of the State Pension) and the new State Pension (which men born from 6th April 1951 and women born from 6th April 1953 receive), though the amounts differ depending on when you retired, with a couple of exceptions in mind:
- For people who reached pension age before 6th April 2016 and received Additional State Pension, only the CPI inflation rate is applied.
- For people who deferred/delayed taking their State Pension, they would only have the CPI inflation rate applied to any extra amount they received.
This increase tries to ensure that pensioners' incomes maintain or grow in value relative to the economy, providing a reliable and predictable foundation for their retirement planning.
State pension increase 2025/26
In April 2025, there was an update to the amount of money pensioners receive for the 2025/26 tax year, and this time, it was the inflation rate that was the highest of the three factors:
- The new State Pension increased from £221.20 to £230.25 per week (a 4.1% rise).
- For those who receive the basic State Pension, there was also a 4.1% rise due to the inflation rate;
- from £169.50 to £176.45 for individuals,
- and from £271.05 to £282.15 for the married rate when going by one spouse’s contributions.
This 4.1% increase means that people eligible for the full new State Pension will receive an annual income of approximately £11,502.40.
While this increase helps pensioners keep up with the rising cost of living, it’s worth considering whether this alone will be sufficient to meet your financial needs in retirement.
Who qualifies for the state pension
Not everyone qualifies for the state pension. Eligibility depends on several factors, including your age, National Insurance record, and where you live. Here's a breakdown:
New State Pension
Available to those who reached State Pension age on or after 6th April 2016. You need at least 10 years of National Insurance contributions or equivalent credits to qualify, and 35 years for the full amount.
Basic State Pension
For those who reached State Pension age before 6th April 2016.
The full basic State Pension requires a different number of qualifying years of National Insurance contributions depending on when you were born and your gender.
Find out more information on this here: www.gov.uk/state-pension/how-much-you-get
Additional State Pension
These are extra payments earned through the State Earnings-Related Pension Scheme (SERPS) or other contributions, but they do not benefit from the triple lock — the additional money does rise in line with the annual inflation rate, though.
Learn more on: https://www.gov.uk/additional-state-pension
International pensioners
If you live abroad, you may not receive annual increases to the State Pension unless you live in a country within the European Economic Area, Switzerland, Gibraltar, or another country with a reciprocal agreement with the UK (although Canada and New Zealand are excluded).
Understanding your eligibility is crucial for figuring out how much you can rely on the State Pension and whether additional retirement savings are needed.
Understanding your retirement income
As we’ve seen, the State Pension provides a foundational income in retirement, but according to the Retirement Living Standards, an individual who has already paid off their mortgage by retirement age will need to have £13,400 a year as a minimum[4]. That’s £1,897.60 a year more than what the maximum State Pension currently offers (£11,502.40 for 2025/26).
To secure a comfortable retirement, it’s important to consider additional savings options:
Workplace pensions
If you're employed and earn over £10,000 a year, your employer must automatically enrol you into a workplace pension scheme — this is called auto-enrolment. If you earn below this threshold, you can still volunteer to opt in. Contributions from both you and your employer need to total at least 8% of your qualifying earnings (typically 5% from you and 3% from your employer). They often include tax advantages and employer matching, making them a valuable tool for investing in your retirement.
Personal pensions
These pension pots are a separate financial product from a workplace scheme or State Pension. Options like SIPPs (Self-Invested Personal Pensions) allow you to take control of your retirement savings by choosing how and where to invest, instead of leaving it in the hands of a provider, the state or your employer to choose.
They can offer tax relief on your contributions, and flexibility, whether you wanted to manage it in a DIY style or by letting the provider’s in-house investing team manage your portfolio for you.
ISAs
Individual Savings Accounts can complement your pension savings. Every year, UK tax residents get an allowance of £20,000 to spread across any ISAs they hold, before it resets again on the following April 6th. You can build this pot of money up as savings or investments, depending on which ISA you choose, and it comes with the additional benefit of being completely free from capital gains and income tax (no matter how large the pot grows to!).
If you’re considering using a few of these fund options, you could create a diversified retirement plan that reduces your reliance on the State Pension.
Planning for retirement: beyond the State Pension
Effective retirement planning involves setting clear income targets and exploring all available options to achieve them. Here’s how you can go beyond the State Pension:
Set retirement income goals
Decide how much you’ll need to maintain your desired lifestyle in retirement. Considering factors like housing, healthcare, and leisure activities.
Maximise workplace pensions
Consider taking advantage of employer contributions and any tax relief benefits available to you.
Leverage personal pensions
Additional pension pots are available to you, and options such as SIPPs can offer flexibility and control over your investments. With Wealthify’s SIPP, you can opt in for a 25% tax relief top-up on any contributions you personally make, as well as choose a range of investment styles and ethical options — tailoring an Investment Plan that’s aligned with your values.
Our team of investing experts manage our customers’ portfolios for them, so they can take back their time and focus on the present.
Diversify your savings
Think about a Stocks and Shares ISA as an alternative, tax-free account that complements your pension fund. By planning ahead, you can build a retirement strategy that aligns with your goals and provides peace of mind.
Conclusion
The state pension has been an important part of retirement income for over a decade, providing vital additional support for millions of retirees.
However, statistics show that relying solely on the State Pension may not be enough for a comfortable retirement.
By exploring options like workplace pensions, SIPPs, and ISAs now, you could take control of your financial future and ensure you’re prepared for whatever changes may come. Start planning today to secure the retirement you deserve.
Ready to take control of your retirement savings? Learn more about how SIPPs can help you boost your retirement income.
With investing, your capital is at risk, so the value of your investments can go down as well as up, which means you could get back less than you initially invested.
Wealthify does not provide advice. If you’re not sure whether investing is right for you, please speak to a financial adviser.
