How does working part-time affect my state pension?

If you’re working part-time, you may be worried about whether this will affect your state pension.

It’s worth reviewing your national insurance (NI) record, whether you’ve received any NI credits and the importance of an additional private or workplace pension. 

What is the state pension? 

The state pension is a weekly payment from the government to qualifying people aged 66 (this will rise to 67 between 2026 and 2028).

Currently, the full new state pension is £221.20 per week (around £11,500 a year) for those who have met all the criteria. This will rise to £230.25 in April 2025 (just under £12,000 a year).

Whether or not you get the full state pension will depend on how much national insurance you have paid during your working life.

You can check your state pension forecast online. 

How do I qualify for the state pension? 

The state pension is based on your NI record, and to get the full amount, you generally need to have paid or have been credited with at least 35 qualifying years of contributions.

If you have between 10 and 35 years of NI contributions, you will get a proportionate amount. You will only get no state pension if you have less than 10 years of contributions.

A qualifying year is typically a tax year in which you earn above a certain threshold, as shown below: 

• Employed and earning over £242 per week.
• Employed and earning between £123 and £242 per week, and are treated as having paid NI contributions. 

Self-employed people no longer have to pay Class 2 NI contributions but can make voluntary contributions to avoid gaps in their NI record if their profits are less than £6,725 a year. 

What are NI credits? 

Not everyone can work all the time, but they may still qualify for the state pension.

Those who have claimed jobseeker’s allowance or have taken time out to raise young children may receive credits towards their state pension. The government website provides a list of the circumstances where credits will be payable.

So, if you work part-time and don’t meet the qualifying thresholds, you may still be able to receive NI credits.

How does the state pension work for part-time workers? 

When you work part-time, your NI contributions are based on your earnings. 

If your earnings are above £242 per week, you will generally still accrue NI contributions for that tax year, regardless of whether you work full or part-time. But if your earnings fall below that limit, you may not accrue contributions for that period, but may still qualify for NI credits. 

It's important to stress that while each qualifying year contributes towards your state pension, the amount you receive is not directly linked to your contributions. 

The state pension is based on a complex calculation considering your NI record over your working life.

What if I have gaps in my NI record?

In some cases, you may be able to make voluntary NI contributions to fill any gaps in your record and increase your entitlement to the state pension.

This can be particularly useful if you have periods of part-time work or gaps in your employment history. 

If you aren’t sure what your NI record is, it’s a good idea to get a state pension forecast. This will tell you how much you are likely to get and when and whether there are any steps you can take to top up your state pension.

The deadline to fill missing gaps on your NI record between 2006 and 2016 is 5 April 2025. After that, you will only be able to plug gaps from the last six years.

Do I still need a private or workplace pension? 

While the state pension provides a basic income in retirement, it may not be sufficient to meet all your financial needs, particularly if you have gaps in your contribution record from working part-time. 

So, having additional private or workplace pensions is recommended to supplement your state pension and help maintain your standard of living.  

If you have access to a workplace pension, you’ll also benefit from employer contributions.

This means you and your employer will contribute a certain percentage of your salary to the pension scheme, which can significantly boost your retirement savings. 

Taking advantage of employer contributions is an opportunity to grow your pension savings effectively. 

Currently, the UK state pension has a so-called ‘triple lock’.

This is a guarantee by the government that the amount paid will not lose value over time by rising by the highest of either average earnings, inflation, or 2.5%. 

Private or workplace pensions can help protect against inflation, ensuring your income maintains its purchasing power over time. 

It's important to consider your financial situation, retirement goals, and any tax implications when deciding whether to open a private or workplace pension. 

Get expert financial advice

It can be tough to figure out how much income you need in retirement, whether you have a workplace pension or personal pension, as well as how much income you can expect from the state pension.

Unbiased can match you with a qualified financial adviser who can help you create a retirement plan and provide personalised guidance, including figuring out how much you need to save for your golden years.