Are you on track with your State Pension? – how to check and what you can do

The clock is ticking for people to plug the gaps in their State Pension record going back to 2006.

In less than six weeks, the window slams shut and you’ll only be able to plug gaps going back six tax years.

The most recent data shows more than 1.1mn Pensioners receiving less than £200 per week from the new State Pension, so there’s lots to be gained by looking at what you’re on track to receive and if you can boost it by plugging the gaps.

Here’s how you can do it.

This article isn’t personal advice. If you’re not sure an action is right for you, ask for financial advice.

How to check if you’re on track

You usually need 10 years’ worth of NI contributions to get any State Pension and 35 years’ worth to get the full amount, for men born after 5 April 1951 and women born after 5 April 1953.

To see if you’re on track, a good place to start is by getting a State Pension forecast which will tell you how much you’re on course to receive and alert you to any gaps in your record.

These gaps can be caused by reasons like unemployment or working abroad.

If you do have gaps, this is your chance to plug them all the way back to 2006 before the deadline of 5 April.

For those retiring today, you can get up to £11,502 per year so it’s worth checking if the records that the Department for Work and Pensions (DWP) hold are in order.

If you’re below the State Pension age, check your State Pension forecast or contact the government’s Future Pension Centre. For those over State Pension age, contact the government’s Pension Service.

Don’t leave it to the last minute to plug the gaps though, websites and phone lines will no doubt get extremely busy in the run up to the deadline. Don’t let last minute tech issues get in the way of you significantly boosting your retirement income.

What to look for

If you spot any gaps in your National Insurance (NI) record, then you can check to see if you qualified for a benefit that comes with any automatic NI credits during that time.

If you do, you might be able to backdate a claim and boost your State Pension for free. A prime example is those who didn’t claim Child Benefit because they were impacted by the High-Income Child Benefit Charge.

You can also buy NI credits to fill the gaps too.

Choosing to go down this route will cost you around £824 per year – partial years cost less. For each year you fill you will get an extra 1/35^th of State Pension which works out at around £328. This means that as long as you live more than three years past the State Pension age you’ll have made your money back for a years’ worth of credits.

But before you hand over your money, check with the Future Pension Centre to make sure you’ll benefit. There can be some circumstances where you won’t, like if you were contracted out of the State Second Pension.

This is a feature of the older basic State Pension system where you could ‘contract out’ of the State Second Pension in return for paying less NI. In this circumstance, you might not be able to boost your State Pension by buying extra credits – it’s worth checking.

What if the State Pension isn’t enough?

While the State Pension is the backbone of people’s retirement income, it’s important you supplement it with your own retirement savings. This could be through a workplace pension or a private pension like a Self-Invested Personal Pension (SIPP).

Small actions like upping your pension contributions when you get a pay rise or new job is one way to boost your contributions.

You should also make sure you’re making the most of any contributions your employer is making.

The HL SIPP can help.

You’ll get access to a wide range of investments to pick from, including the HL Ready-Made Pension Plan, and a full range of retirement options.

And as well as getting tax relief, your pension can also grow free from UK income and capital gains tax.

You usually can’t access a workplace or private pension until age 55 (rising to 57 in 2028). Remember, pension and tax rules can change, and any benefits depend on individual circumstances.