The State
Pension
What is the new State Pension?
The new State Pension is a regular payment made to you by the government once you reach State Pension age. You’ll be able to claim it if you’re eligible and reached State Pension age on or after 6 April 2016. The full new State Pension is £221.20 a week, that’s £11,502.40 in the current tax year.
How much is the State Pension?
The amount of State Pension you’ll get will depend on your circumstances, including:
- If you qualify for the old basic State Pension or new State Pension
- How many ‘qualifying years’ of National Insurance (NI) contributions you have
- If you contracted out of the additional State Pension
The number of qualifying years you have will depend on how many years you have been employed or self-employed and paid NI contributions, and the number of years you have received NI credits for.
Will I get the basic State Pension?
Men born on or before 5 April 1951, and women born on or before 5 April 1953, who’ve paid NI for at least one year, usually qualify for the basic State Pension.
This tax year, this pays a maximum of £169.50 per week, plus any additional State Pension. You will receive the maximum basic State Pension if you have 30 NI qualifying years.
Will I get the new State Pension?
Men born after 5 April 1951, and women born after 5 April 1953, who’ve paid NI for at least ten years qualify for the new State Pension.
This is a maximum payment of £221.20 per week, for the current tax year. You will receive the maximum if you have 35 NI qualifying years.
How do I get a State Pension forecast?
To see what State Pension you could get, you can get a State Pension forecast from the government online.
What is contracting out of the State Pension?
Those who reached State Pension age before 6 April 2016 may have built up Additional State Pension alongside their basic State Pension. But it was possible to opt out (or “contract out”), meaning NI contributions were paid into a workplace or private pension instead.
You can see whether you’ve been contracted out and find out more on the government’s website.
What if I have been contracted out?
If you were contracted out, you’d either have been making NI contributions at a reduced rate or that part of your NI contributions were paid into your workplace or private pension pot instead.
Your State Pension might be lower if you contracted out, but you may be able to increase it by making voluntary NI contributions.
What if I have been contracted in?
You won’t lose out if you continued to build up an entitlement to the Additional State Pension. When you come to take your State Pension, the amount you could receive under the new and old rules will be calculated.
Whichever value is the higher will be your starting amount. If this is more than the new maximum full level of State Pension (£221.20), you’ll get the higher amount.
What is the State Pension age?
The State Pension age is the earliest age you can start receiving your State Pension. This will be different for everyone as it is worked out based on your date of birth.
State Pension age is currently 66 and is due to increase to 68 by 2046. Although there’s no guarantee it won’t rise quicker or higher than that.
You can check your State Pension age using the government’s State Pension age calculator.
How do I claim the State Pension?
Your State Pension won’t start automatically - you must claim it. You should get a letter no later than two months before you reach State Pension age, telling you what to do.
How to increase your State Pension
There are two ways you can boost what your State Pension will pay. This information is here to help you, but it isn’t personal advice. If you’re not sure what’s right for your circumstances, please ask about advice.
You can defer your State Pension
If you qualify for the new State Pension, for every nine weeks you defer, your payment will rise by 1%. It works out as roughly 5.8% extra for each year. The current full State Pension is £221.20 a week but defer it by a year and you'll get an extra £12.83 a week. You must delay your State Pension by at least nine weeks to receive an increase.
If you receive the old State Pension and haven’t previously deferred, then you can get an extra 1% for every five weeks you defer. Your State Pension will increase for every week you defer, if you defer for at least five weeks.
If you defer the old State Pension for at least one year, you can receive the extra amount as a lump sum instead of income.
You can also defer payments once you have already started receiving your State Pension, but you can only do this once.
Can I buy extra pension years?
If you have gaps in your National Insurance history, for example because you took a career break, you might be able to make these up with voluntary payments.
You can check your NI contributions (NICs) history online to see if you have any gaps.
Normally, you can only make up for gaps from the last six years. The deadline to do this is 5 April each year. This means you have until 5 April 2025 to make up for gaps for the 2018-19 tax year.
Find out more on voluntary NICs on the government website.
Is the State Pension enough to live on?
Whilst the State Pension can help cover some of your expenses, it probably won’t cover them all.
The Pensions and Lifetime Savings Association estimate that a retired single person living outside London will need £14,400 each year, after tax, to achieve their minimum living standard. But the full new State Pension is only around £11,500 a year. And you’ll probably need even more than this if you want more financial security and flexibility in retirement.
But don’t worry, there are plenty of things you can do to try and plug the gap. The first step is to see how much you’re on track to get at retirement based on your current pension savings. You can do this with our pension calculator, which also lets you include the full new State Pension amount.
