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Spring is here and with it the new financial year. This year, it also brings the new national living wage. But what is it and what does it mean for you?

What Is The National Living Wage?

The national living wage is basically a new minimum wage for the over 25s. In April 2016, it changes to £7.20 per hour, adding an extra 50p per hour to pay packets.

It should not be confused with the Living Wage, which is a voluntary rate calculated annually by the centre for Research in Social Policy at Loughborough University, looking at how much money households need to have a minimum acceptable standard or living.

What Does The National Living Wage Mean For Me?

The national living wage now means that employers will have to pay their employees who are working and aged 25 or over at least £7.20 per hour. If you are under the age of 25, you will be paid the minimum wage of £5.30 for 18-20 year olds or £6.70 for 21- 24 year olds.

What’s The Difference Between The National Living Wage & The Minimum Wage?

The national living wage is basically the new minimum wage for the over 25s. If you’re under 25, the new changes will not affect you.

The minimum wage is the minimum amount most employees in the UK can be paid. This is an hourly rate which employees are legally entitled to.

How Is The Living Wage Calculated?

Living wage is calculated based on minimum income requirements. You can find out if you’re eligible for the National Living Wage here.