State pension
When you retire, the Government provides a small state pension to help with your living costs.
What is the state pension?
The state pension is a weekly government payment which you can claim when you reach the state pension age (currently 66).
You can claim your state pension alongside any other pensions you hold.
How much state pension will I get?
The amount of state pension you get is determined by the number of years you have paid national insurance (NI).
The full state pension is currently £221.20 a week. You must have paid 35 years’ worth of NI contributions to qualify. Over a year, the full state pension is worth around £11,502.
To receive any state pension, you need to have at least 10 qualifying years of NI contributions. The minimum state pension is worth about £63.20 a week.
If you have between 10 and 35 years’ worth of NI contributions, your state pension is calculated proportionally. For example: a state pension based on 20 years NI contributions is calculated by dividing £221.20 by 35, and then multiplying it by 20. This would provide a weekly pension of £126.40.
How do I find out what my state pension will be?
You can get a forecast of your current state pension with the government’s website for checking your state pension. Please note that it is an estimate and that the state pension amount is likely to change yearly.
When can I claim my state pension?
You can claim your state pension when you reach the state pension age (currently 66).
The state pension age is scheduled to rise gradually over the coming years. Between 2026 and 2028, the age before you can claim your state pension will increase to 67.
You do not have to claim your state pension when you reach your state pension age. Instead, you can choose to defer taking your state pension. For every nine weeks that you defer taking your state pension, you can increase the amount you receive by 1%. If you delayed taking your state pension for a year, you would get an extra 5.8%. This would boost your pension by £12.82 a week.
Whether deferring earns you more money in the long run depends on how long you live for. If you deferred for a year, you would have to claim your state pension for over 17 years to recuperate the payments you missed by deferring.
Can I increase my state pension?
You can top up your state pension by paying voluntary national insurance contributions. This is only possible if you have paid NI for fewer than 35 years.
In most cases, you can make up to six years of voluntary national insurance contributions. This costs £17.62 a week.
In return, you add full a qualifying year to your record and increase your state pension by £5.82 each week. Your financial return from buying extra qualifying years will depend on how long you live for.
Can I claim my state pension while I’m still working?
You can claim your state pension while you’re still working, once you reach pension age. The state pension counts towards your taxable income. Taking your state pension while working could potentially push you into a higher income tax bracket.