People pay into the system all their lives through National Insurance contributions to receive their state pension so it’s important to get the payments as soon as an individual reaches 66. This is all the more important as payments are to increase by 10.1 percent in just a matter of weeks.
A person will not automatically receive the money once they reach state pension age. This is because a person has to apply to get the payment.
People will receive a letter if they are set to reach state pension age within three months which includes an important invitation code for the application.
The easiest way to apply is to do so online through the Government website. A person will need to provide several details for the application.
These include:
- The date of their most recent marriage, civil partnership or divorce
- Dates for any time spent living or working abroad
- Their bank or building society details
- The invitation code from the letter about getting their state pension.
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If a person loses their invitation code, they can request one to be sent out by post to their home address.
The code has to be sent to their home address to avoid any risk of fraud. They should receive the letter within five days of requesting it.
A person can also phone the Pension Service to request a claim form to be sent out to them.
The completed form should be sent to Pension Service 8, Post Handling Site B, Wolverhampton, WV98 1AF.
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A person may also want to check how much state pension they are entitled to receive using the state pension forecast tool on the Government website.
The tool will show a person if there are any gaps in their National Insurance record and if they can fill any of these gaps by voluntarily paying contributions.
People can currently pay contributions as far back as 10 years ago but this is only until the end of the tax year, after which individuals will only be able to pay contributions as far back as six years ago.
The full new state pension is currently £185.15 a week and a person typically needs 35 years of contributions to get the full payment.
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The full basic state pension pays £148.85 a week and people usually need 30 years of contributions to claim the full amount.
Helen Morrissey, head of retirement analysis at Hargreaves Lansdown, warned many people get less than the full amount because of gaps in their employment record.
She said: “If you do have gaps, then it’s worth checking with DWP as you may be able to claim benefits for these time periods that come with a voluntary National Insurance credit.”
She said people should consider buying contributions if they can afford the expense as they may get their money’s worth.
She explained: “A full year costs around £800 and for each year bought you get 1/35th of a year’s state pension – around £275.
“This means you effectively earn your money back in around three years so it can prove very good value.”
However, the financial expert said individuals should check with the DWP before buying credits, to be sure it is worth purchasing them.
Some 1.8 million pensioners receive a state pension payment of less than £100 a week, according to the latest figures.
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