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Pension warning as pensioners could end up being £12k worse off if they make one mistake | Personal Finance | Finance

One in six people would be interested in drawing their pension early. Yet, shocking new research shows 63-year-olds who do take their pension early could cost themselves £12,000.

As the Government continues its consultations on raising the state pension age to 67 and later 68, new research has emerged which shows this could have a damaging effect on pensioners.

While increasing the age at which people retire would save the Government around £11billion a year, this could lead to the older generation taking their state pension early.

However, anyone who does so could end up thousands of pounds out of pocket.

Figures show Britons who draw their state pension three years early would be £11,883 worse off by age 90, according to experts at Canada Life.

READ MORE: Half a million carers are missing out on £278 from DWP – are you?

While the figures from Canada Life make for grim reading, thousands of Britons could be risking their full state pension because of mistakes they made earlier in life.

Figures show 200,000 parents a year are applying for child benefit in the wrong parent’s name.

Parents who stay home to look after children are missing out on (NI) national insurance credits, which means they may not qualify for their full state pension when they retire.

Britons need 35 years of NI credits to claim a full state pension.

What is the High Income Child Benefit Charge?

Since 2013, if one of the parents earns over £50,000, they will pay the charge, which means paying back a chunk of their child benefit.

The amount someone repays rises with their earnings, until someone earning £60,000 repays it all.

Someone who repays it all can opt out instead.

To repay it, people need to complete a self-assessment form every year.

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