Not all retirees will be entitled to full £230.25 a week
Older people do not automatically receive full weekly new state pension payments when they retire(Image: Shared Content Unit)
Older people looking forward to retirement are being reminded that they will not automatically receive the full new weekly state pension payments. To be entitled to the full sum, they will need to have paid a certain amount of National Insurance contributions.
Latest statistics from the DWP – Department for Work and Pensions – show that the state pension currently provides a regular financial income for 13 million older people across the country. It’s available to those who have reached the UK Government’s eligible retirement age – which is currently 66 for both men and women but due to rise to 67 in April – and who have paid at least 10 years’ worth of National Insurance contributions.
But many of those heading into retirement may not be aware that they will need to have accumulated around 35 years’ worth of NI contributions in order to receive the full new state pension payment which is £230.25 each week, reports the Daily Record. This is the average number of years as some people may have been ‘contracted out’ so will need more NI contributions to qualify for the full sum and further information about this is available on the Government website..
While some people’s workplace and private pensions will help boost the retirement coffers, others could be relying upon the contributory benefit as their only income in retirement, making it vital to be aware of how many years of NI contributions are needed order to secure the maximum payout.
With the state pension age due to increase from 67 to 68 years in the mid-2040s, it’s a good idea to keep on top of what the financial future may look like. The guide below outlines how National Insurance contributions affect the amount of State Pension paid.
How to receive any new state pension payment
At least 10 qualifying years will be needed on your National Insurance record to qualify for any state pension – but these do not have to be in a row. So, for 10 years at least one or more of the following will have applied:
you were working and paid National Insurance contributionsyou were receiving National Insurance credits: for example if you were unemployed, ill, a parent or a careryou were paying voluntary National Insurance contributions
Anyone who has lived or worked abroad might still be able to claim some new state pension. Someone who has paid married women’s or widow’s reduced rate contributions might qualify too. Find out more on the GOV.UK website here.
How to receive full payments
The term ‘full’ means the maximum amount of new state pension a person can receive. Around 35 qualifying years will be needed to receive the full new state pension if you do not have a National Insurance record before April 6, 2016.
This may be more if you were ‘contracted out’ – see here. Those who have contributed between 10 and 35 years will be entitled to a portion of the new state pension but not the full amount unless they buy additional NI years.
Qualifying years if you are working
When working, you pay National Insurance and will receive a qualifying year if the following applies:
you are employed and earning over £242 a week from one employeryou are self-employed and paying NI contributions
You might not pay National Insurance contributions because you are earning less than £242 a week. You may still have a qualifying year if you earn between £123 and £242 a week from one employer – find out more here.
Qualifying years if you are not working
You may receive National Insurance credits if you cannot work: for example, due to an illness or disability or if you are a carer or are unemployed. You can receive National Insurance credits if you:
claim Child Benefit for a child aged under 12 (or under 16 before 2010)receive Jobseeker’s Allowance or Employment and Support Allowancereceive Carer’s AllowanceIf you are not working or receiving National Insurancecredits
You might be able to pay voluntary NI contributions if you are not in one of these groups but wish to increase your state pension amount. Find out more here.
Gaps in the National Insurance record
You can have gaps in your NI record and still receive the full new state pension. A state pension statement will tell you how much state pension they may receive.
You can apply for a National Insurance statement from HMRC – HM Revenue and Customs -to check if your record has gaps. If there turn out to be gaps that would prevent you from having the full new state pension, you may be able to do the following:
get National Insurance creditsmake voluntary National Insurance contributions
Check your National Insurance record on GOV.UK here.
Check your state pension age
To check your state pension age, to find out when you can retire and claim state pension, you can use the free online tool at GOV.UK here. This will tell you the following:
when you will reach State Pension ageyour pension credit qualifying age
For more articles about the state pension see here.
Get all the latest money news and budgeting tips from Chronicle Live with our free newsletter.
Join our WhatsApp communities
ChronicleLive is now on WhatsApp and we want you to join our communities.
We have a number of communities to join, so you can choose which one you want to be part of and we’ll send you the latest news direct to your phone. You could even join them all!
To join you need to have WhatsApp on your device. All you need to do is choose which community you want to join, click on the link and press ‘join community’.
No one will be able to see who is signed up and no one can send messages except the ChronicleLive team.
We also treat our community members to special offers, promotions, and adverts from us and our partners.
If you don’t like our community, you can check out any time you like. To leave our community click on the name at the top of your screen and choose ‘exit group’.
If you’re curious, you can read our privacy notice.
Join the ChronicleLive Breaking News and Top Stories community
Join our Court & Crime community
Join the Things to do in Newcastle and the North East community
Join our Northumberland community
Join our County Durham community
Join our Great North Run community