A quarter (25 percent) of over 65s are unaware they could receive a higher weekly payment or even a lump sum by deferring the date when they begin to get their UK state pension, new research by retirement specialist Just Group has found. This rises to 29 percent among 55 to 64-year-olds.

At that time, 1.25 million pensioners received extra income via deferral.

Most of the fall has been among women whose state pension age began rising from age 60 in 2010.

In 2004, women made up 80 percent of those receiving extra pension.

Now, they make up 73 percent of those getting the increased sum.

According to Stephen Lowe, group communications director at Just Group, the fall is to be expected given rising state pension age and changes introduced with the New State Pension in April 2016 that reduced the returns for deferring.

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“Deferring State Pension is still available and is something that should be considered alongside other retirement options,” he said.

“In some circumstances it can make sense to forego some income in the short term for a higher income in later life that is guaranteed to keep up with inflation.

“Our concern is that a quarter of over-65s are unaware it is an option, raising questions about the support they are receiving when making pension decisions.”

So, how can a person defer the state pension?

The state pension is not paid automatically at state pension age, but rather it must be claimed.

Once claimed, when a person reaches state pension age they will then get the payment.

However, those wanting to defer, or delay, getting the payment, can do so simply by not claiming.

Reaching state pension age before April 6, 2016

A person can usually take the extra state pension earned as either higher weekly payments or as a one-off sum.

When the deferred state pension is claimed, the person will receive a letter asking how they want to take the extra amount.

From the date of receiving the letter, one has three months to decide.

Higher weekly payments

Provided it is deferred for at least five weeks, the state pension increases each week one defers, by the equivalent of one percent for every five weeks.

For every 52 weeks, this works out at 10.4 percent.

It will be paid with the regular state pension payment, once claimed and the person has decided they would prefer higher weekly payments.

Lump sum payments

It’s possible to get a lump sum payment, provided they have deferred the state pension for at least 12 months in a row.

This will include interest of two percent above the Bank of England Base Rate.