It's important to start thinking about your pension from an early age.
State Pension is a contributory payment and the amount people receive depends on how long they have been making National Insurance (NI) contributions towards it. The full new State Pension is £185.15 per week.
However, data from the Department for Work and Pensions (DWP) shows that under half of the claimants receive this amount. The 2019 study uncovered just under 500,000 of the 1.1 million people who claim the new State Pension receive the full amount - as The Daily Record reports.
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The UK government raised the State Pension age to 66 for both men and women in 2020. There are plans to increase this to 68 over the coming years.
The actual amount you get depends on your National Insurance record. Your National Insurance record before April 6 2016 is used to calculate your ‘starting amount’.
To qualify for the new full State pension, you will need at least 10 qualifying years on your NI record to get any State Pension and they don’t have to be 10 qualifying years in a row.
This means for 10 years at least one or more of the following applied to you:
you were working and paid NI contributions
you were getting NI credits for example if you were unemployed, ill, a parent or a carer
you were paying voluntary NI contributions
If you have lived or worked abroad you might still be able to get some new State Pension.
You might also qualify if you have paid married women’s or widow’s reduced rate contributions - find out more about this on the GOV.UK website here.
You will need 35 qualifying years to receive the new full State Pension if you do not have a NI record before 6 April 2016. For people who have contributed between 10 and 35 years, they are entitled to a portion of the new State Pension.
Qualifying years if you are working
When you’re working you pay NI and get a qualifying year if:
you’re employed and earning over £190 a week from one employer
you’re self-employed and paying NI contributions
You might not pay NI contributions because you’re earning less than £190 a week. You may still get a qualifying year if you earn between £123 and £190 a week from one employer.
Qualifying years if you are not working
You may get NI credits if you cannot work - for example because of illness or disability, or if you’re a carer or you’re unemployed.
You can get NI credits if you:
claim Child Benefit for a child under 12 (or under 16 before 2010)
get Jobseeker’s Allowance or Employment and Support Allowance
receive Carer’s Allowance
If you are not working or getting NI credits
You might be able to pay voluntary NI contributions if you’re not in one of these groups but want to increase your State Pension amount. Find out more on the GOV.UK website here.
What if there are gaps in your NI record?
You can have gaps in your NI record and still get the full new State Pension.
You can get a State Pension statement which will tell you how much State Pension you may get. You can then apply for a NI statement from HM Revenue and Customs (HMRC) to check if your record has gaps.
If you have gaps in your NI record that would prevent you from getting the full new State Pension, you may be able to:
get NI credits
make voluntary NI contributions
Check your National Insurance record here.
Check your State Pension age
Check your State Pension age using the free Gov.uk online tool here.
This will tell you:
- when you will reach State Pension age
- your Pension Credit qualifying age
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