State Pension

The state pension is a small guaranteed pension provided by the government, and while it can be useful to top up the income you receive from your private pension, it’s unlikely you will be able to rely on it as your sole retirement income.

The New State Pension

As of April 2016 the state pension changed. The new flat rate rose to £155 per week, which is good news for some, but the additional state pension (which is earnings-related) has been abolished for new pensioners. This will mean a lower overall state pension for many people.

The state pension alone is unlikely to provide you with enough to live on, so it's important to make your own provisions with a workplace pension or a private pension. An independent financial adviser will be able to help you put suitable plans in place.

The age when you can start claiming state pension is rising, and will reach 67 between 2026 and 2028.

Basic State Pension (the 'old' State Pension)

If you reached state pension age before April 2016, you will still be on the old-style state pension - the basic state pension with perhaps some additional state pension on top.

The current basic state pension for a single person is less than £480 per month. Your entitlement to a full state pension income also depends on having paid enough National Insurance contributions over a number of years, a minimum of 30 years.  In some circumstances it’s possible to get credits for ‘missing’ years if you were a non-working parent or carer for a time or you may be able to top up your National Insurance contributions.  Since April 2011, the basic state pension rises each year by at least 2.5 per cent. 

If you reached your State Pension Age by 6 April 2016, you are entitled to top up your state pension entitlement by up to £25 per week, by paying a single lump sum. You can only do this before April 2017.

 

Questions to ask a Pensions Adviser...

  • How much will I get from the state pension and how do I get a state pension forecast?
  • Will I be better or worse off under the new state pension?
  • If I’ve missed National Insurance payments, how can I qualify for a full state pension?
  • What other ways can I fund my retirement?
  • Can I top up my state pension?