Will I miss out on my State Pension?
At Passman Leonard, we understand the importance of planning for your future and ensuring that you receive all the benefits that you are entitled to. One of the most important benefits is the State Pension, which provides a regular income in retirement. However, many people are concerned about missing out on their State Pension, particularly if they have not paid National Insurance contributions for their entire working life.
State pension age is currently 66 years for both men and women, but this is set to increase to 67 years by 2028 and 68 years by 2037.
The State Pension is a regular payment from the government that you can claim when you reach State Pension age. The amount you receive is based on your National Insurance record, which shows how many qualifying years you have paid National Insurance contributions. The current State Pension system is made up of two parts: the basic State Pension and the new State Pension.
Basic state pension
The basic State Pension is available to men born before 6 April 1951, and women born before 6 April 1953. To qualify for the basic State Pension, you need to have paid National Insurance contributions for at least 35 qualifying years. A qualifying year is a tax year in which you have paid or been credited with National Insurance contributions. If you have not paid National Insurance contributions for the full 35 years, you may still be able to receive a reduced State Pension based on the number of qualifying years you have.
New state pension
To receive the full new State Pension, the number of years required depends on when you reach state pension age. For individuals who reach state pension age before April 2016, they need to have 30 qualifying years of National Insurance contributions to receive the full basic state pension.
For those who reach state pension age after April 2016, the rules are slightly different. They need to have at least 10 qualifying years of National Insurance contributions to receive any state pension, and 35 qualifying years to receive the full new state pension, which is currently £203.85pw per week (April 2023).
National Insurance and Pensions are important aspects of the UK’s social security system that can have a significant impact on your financial wellbeing in retirement.
Worried you will miss out on your state pension?
If you are concerned that you may miss out on your State Pension, there are steps you can take to protect your entitlement. Firstly, it’s important to ensure that your National Insurance record is up to date. You can check your National Insurance record online using your Government Gateway Account or request a statement from HM Revenue & Customs. See our useful guide: How to create a Government Gateway Account.
If you have any gaps in your National Insurance record, you may be able to fill them by paying voluntary National Insurance contributions. Voluntary National Insurance contributions can be paid for any tax year in which you have not paid or been credited with National Insurance contributions.
N.B. If you want to make voluntary contributions for the tax years 2016 to 2017 or 2017 to 2018, the deadline has been extended. You have until 5 April 2025 to pay.
If you are approaching State Pension age and have not paid National Insurance contributions for the full 35 years, you may still be able to increase your entitlement. For example, you may be able to claim National Insurance credits if you are caring for someone, unemployed, or on a low income. You may also be able to claim credits for periods when you were living or working abroad.
It’s important to note that you do not have to stop paying National Insurance contributions when you reach State Pension age. In fact, paying National Insurance contributions can help you to increase your entitlement to the State Pension and may also entitle you to other benefits, such as Bereavement Support Payment.
It is essential to understand the rules and regulations surrounding National Insurance and Pensions, so you can make informed decisions about your financial future.
How we can help you with National Insurance and Pensions
At Passman Leonard, we can help you to understand your National Insurance record and your entitlement to the State Pension. We understand that planning for retirement can be complex, and we are here to work with your financial advisor to help you navigate the process.
This will ensure that you receive all the benefits you are entitled to, to ensure that you have the financial security you need to enjoy your golden years.
It’s also worth noting that the State Pension is just one source of income in retirement, and it may not be enough to meet all of your needs. That’s why it’s important to plan for your retirement early and consider other sources of income, such as personal pensions or workplace pensions.
Any questions on National Insurance and Pensions? Get in touch today via email info@passmanleonard.co.uk or call on 01895 434515. We are here to help.
