The State Pension is as close to a guaranteed source of income as you can get.
If you have paid enough National Insurance for 35 years, you will receive the full amount, which is currently £203.85 per week or £10,600 per year. This amount will likely continue rising due to the triple lock guarantee, which protects against inflation.
What if I have not made enough National Insurance contributions?
Did you know that you can increase your State Pension by making additional National Insurance contributions? This will help you receive a fuller State Pension when you retire. Currently, the Government is offering a special promotion that allows you to top up by more than usual. However, you need to act fast as the offer ends on July 31st.
If you have missed any contributions in the past six years, the government allows you to make them up. It is worth noting that due to a one-year lag in the tax system, you can even go as far back as 2016 to make additional payments. However, be prepared to spend up to £800.80 per year on this. Investing up to £4,804.80 can go towards giving you the maximum State Pension upon retirement, currently at £10,600 annually. This amount will be paid to you throughout your lifetime provided that you have made 35 years of full National Insurance contributions. It is a valuable investment worth considering.
Apart from the standard six-year plan, there is a unique opportunity for women born after April 5th, 1953, and men born after April 5th, 1951. They have the option to make voluntary contributions to fill the gaps between April 2006 and April 2016, which totals ten additional years. Nonetheless, this limited-time offer will expire on July 31st, 2023, after which only the previous six years can be purchased.
What is the process to top up my state pension?
It is simple to top up your State Pension. However, you’ll need a Government Gateway account to do the online components.
Before proceeding, it is important to verify your eligibility and determine whether there are any gaps in your National Insurance contributions. To get an idea of your pension amount and when you’ll start receiving it, you can get your State Pension summary. It’s also a good idea to check your National Insurance record for any incomplete contributions. Any years with less than a full contribution since 2016 (or since 2006 under the special offer) can be made up.
It is advisable to consult with professionals who can offer valuable guidance in making an informed decision. By assessing your financial situation and contributions, they can advise you on whether to purchase additional years or extend your working period to fulfill the required 35 years.
To complete the process, you will need to get in touch with the Future Pension Centre, which is a department of HM Revenue and Customs. Please be aware that they are currently experiencing staff shortages and may be busy, so it may take some time to reach them. Once you are able to speak with them, they will be able to advise you on whether topping up is advantageous for you, and they will also provide you with the necessary code to make an online payment.
In case you would rather not do this online, there are alternative options such as telephone and paper-based methods. For your convenience, we have provided the contact information for the Future Pension Centre and HM Revenue and Customs below.
Future Pension Centre helpline:
Open 8 am until 6 pm Monday to Friday
Telephone: 0800 731 0175
Telephone from outside the UK: +44 (0)191 218 3600
Welsh language telephone: 0800 731 0175
Textphone: 0800 731 0176
HM Revenue and Customs:
National Insurance Contributions and Employer Office, BX9 1AN