With recent rhetoric focusing on the importance of funding your own provisions for retirement, the state pension may get less attention then it deserves.

The state pension is the foundation of retirement planning for many people in the UK, therefore it is important that you are aware of your entitlement. In 2016 the UK moved to a single tier state pension benefit and with that some changes to the way you obtain it. To qualify for the benefit you will need a minimum of 10 qualifying years and 35 qualifying years to be eligible for the full amount. You may also be eligible to claim credits for years you were unable to work, details of this can be found on the government website. A common example is the years of claiming child benefit for a child under the age of 12.

What if I do not qualify for the full state pension

Anyone who could benefit from the state pension is able to obtain a “State Pension Forecast” from the government website. This is where you will be able to identify any gaps in your national insurance contribution history. If you are close to your state pension age, there are still steps you can take to ensure you receive the full amount.

For missed years you can make voluntary contributions, this will boost your state pension entitlement and provide you with a greater level of guaranteed income in retirement. The cost of funding missed years varies depending on the years that were missed, if you were self-employed this is often lower.

The importance of checking now

You can usually pay voluntary contributions for the previous six tax years, however there are couple of exceptions that will be coming to an end after the 5^th of April 2025. These are:

• If you want to make voluntary contributions for the tax years 2016 to 2017 or 2017 to 2018, the deadline has been extended. You have until 5 April 2025 to pay.
• You’re a man born after 5 April 1951 or a woman born after 5 April 1953.
• You have until 5 April 2025 to pay voluntary contributions to make up for gaps between tax years April 2006 and April 2016.

After 5 April 2025 you’ll only be able to pay for voluntary contributions for the past 6 years. This may not be enough to qualify for a new State Pension if you have fewer than 4 qualifying years on your National Insurance record.

How does this affect my retirement

The state pension alone is not often enough to give you the retirement that you wish for. It does however form an integral part and will often be the only source of guaranteed income that many people in the UK will have available, outside of purchasing an annuity-based product. The state pension should be viewed as the base of anyone’s *retirement, which is then supplemented with other forms of retirement income such as various pensions and savings. Being sure that you can claim as much as possible before you are due to retire is of great importance.

If you’d like to speak with us about your pension and finances, feel free to contact us at info@ssfs.co.uk.