Fortunately, there are services available which can help people find out more about their retirement prospects and many ways to potentially boost one’s state pension. From Child Benefit to Pension Credit, there are plenty of options and no reason for people to receive less than they deserve.
Buy NI credits
“If you can spare the cash, you can plug gaps in your NI record by buying voluntary class 3 NI contributions. Buying a full extra year for £800 will boost your pension by £4.80 a week, equivalent to about £250 a year and you can typically buy up to six years’ worth.”
Claim Pension Credit
“If you’re over state pension age and on a low income then you should check whether you are eligible for Pension Credit. Pension Credit tops up your weekly income to £177.10 if you’re single and £270.30 in joint income if you have a partner.
“It also entitles you to other benefits such as help with council tax and a free TV licence for the over 75s. Despite having the ability to really boost the income of the poorest pensioners take up of this benefit remains stubbornly low with only around 60 percent of those entitled claiming it.”
New research from Hargreaves Lansdown found that nearly one in five Britons do not know when they will get their state pension, with over a third not knowing how much state pension they will receive. Ms Morrissey had her say on the findings and encouraged people to check how much pension they are entitled to.
She said: “We don’t know when we’ll get our state pension, or how much we’ll get – which makes planning for retirement almost impossible.
“The state pension age has been on the rise in recent years, which has either passed people by, has left them completely confused, so huge numbers of people have no idea when they might get their pension.
“Unsurprisingly more younger people are in the dark, partly because it’s such a distant prospect, and partly because some of them are likely to expect more rises in the state pension age by the time they get there.
“However, more worryingly, over a quarter of people in the 45-54 age group were also confused and this is concerning, because their plans for retirement should be much more detailed by this stage.
“Meanwhile a third of people don’t know how much they are likely to receive – this includes 35 percent of those in the 55-64 age group. The state pension forms the backbone of many people’s retirement planning and making plans based on incorrect assumptions can derail someone’s plans and undermine their financial resilience.”
Ms Morrissey warned Britons that if they do not rack up enough years of National Insurance contributions across their working life, they could receive less than the full pension.
She explained: “Over time, increasing numbers of people will receive more state pension, as more people with longer work records reach retirement age.
“However, not everyone will be able to accumulate the 35 years’ worth of NI needed for the full state pension, and any periods of contracting out will also impact the amount received so people will still slip through the net. Recent HL analysis of Government figures showed there are still over two million pensioners receiving less than £100 per week.
“If you don’t know how much state pension you’re due to get, it’s vital to check it online. It’s an opportunity to discover whether there any gaps, and to take control of your retirement planning.”
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