Most people still to get their state pension will get a full entitlement, it may not all be paid by the state (many people get part of it paid as part of their company pension) but so long as you’ve done a lifetime’s work, it’s unlikely you’ll fall short of the full entitlement which is currently £185 a week.
This is an amazingly valuable pension. If ever there was a pension that deserved to be called “gold plated”, the state pension is it. It goes up each year by the higher or inflation, earnings growth or 2.5% and this year it will go up more than 10%. OK there are blips to this formula (known as the triple lock), but so long as it applies, the state pension looks more and more ” a good thing”. You will not get such generous increases if you are in a company defined benefit scheme or even in a public sector pension. The state pension is currently the tops.
Sadly, there are a lot of people who do not get an entitlement to all the state pension. A DWP estimate in 2019 suggested that 44% of people (mostly women) were not getting the full state pension under the old rules and though the percentage for people getting a full entitlement on the new rules (after April 2016) is likely to be higher, there are still a lot of people missing out.
In other blogs, I explain how you can buy back entitlement by paying money to the DWP in exchange for extra years of entitlement. You should do that unless you already have a full entitlement or unless you can get extra credits for free.
This blog explains how you might be entitled to extra state pension for free. Before you get excited you should check your state pension forecast, you may be pleasantly surprised to find you don’t need to top up or claim!
Once you’ve done that and IF you find you won’t get a full state pension , it’s time to check your national insurance record to see if how the DWP understand your working (or non-working) career, tallies with your.
When I checked my record – which went back to before I went to college, I found that there were years when I didn’t earn any state pension (I was away in Iceland for a year) and years when I was self-employed and didn’t pay the full stamp. But luckily in the 40 years that I’ve been at work, I have my 35 years that qualify me for a full state pension.
The DWP knew quite a lot about me but not everything and it may well be that some of your non-qualifying years should be qualifying years.
There are also a range of scenarios that see you build up benefit entitlement automatically, such as being in work and consistently earning over the trigger threshold (£6,396 a year), or claiming certain benefits. See the full list of scenarios where you get automatic NI credits.
But mistakes are made!
Ace journalist Jo Cumbo found that the DWP had missed several years when she was working at the FT but the DWP had no record – she got evidence and is making her claim. You may not be so lucky in having evidence but that’s when you should be getting into a discussion with the DWP about what they’ll accept.
And not all your entitlements are automatically recorded.
It’s not only work that earns you national insurance (NI) years. There are a whole host of activities that can get you a qualifying NI year. Some are given automatically, but others aren’t.
If you’ve been in any of these scenarios in years in which you had gaps in your NI record, you can apply manually for NI credits for that year:
– Statutory sick pay: You are/were on it and not earning enough for a qualifying year.
– Jobseeker’s allowance: You are/were eligible for it but not claiming it.
– Employment and support allowance: You are/were eligible for it but not claiming it.
– Caring for a family member: As long as you are/were between 16 and state pension age and the family member is/was under 12 and not your child. Also known as ‘grandparent credits’.
– Caring for a sick/disabled person: As long as it is/was for at least 20 hours a week.
– On jury service: You are/were on it and aren’t/weren’t self-employed.
– Wrongly imprisoned: As long as your conviction has since been quashed.
– A foster carer (or kinship carer in Scotland): As long as it’s been since 6 April 2010.
– On statutory maternity, paternity or adoption pay: You are/were on it and didn’t/won’t earn enough for a qualifying NI year (additional statutory paternity pay also counts).
– Spouse of a member of the armed forces: You’re married to, or a civil partner of, a member of the armed forces and went with them on an overseas posting (additional eligibility rules apply here).
– On a Government-approved training course: You are/were on one, are over 18, and weren’t sent on the course by Jobcentre Plus.
Full information on how to manually apply for any NI credits you’re due is on the Government’s national insurance credits page.
Most will have already got any NI credits they’re due. But if you haven’t, make sure you claim them
Thanks to Martin Lewis and Steve Webb for great source material, you can read Martin’s brilliant work on this here.
It’s also worth perusing the forum on this – on the MSE Website. Some of this is very involved with most of the issues being about “contracting out”, either personally or through a company pension scheme. I may write further on this issue.