Martin Lewis MSE warning as you could boost DWP state pension by over £50,000 – full guide_l
The Money Saving Expert team said the financial check could provide an “unbeatable” boost to your income.
People can boost their state pension by topping up their National Insurance contributions (Image: Getty)
State pensioners and those planning for their later years have been urged to do a check that could boost their retirement income by over £50,000.
Martin Lewis‘ Money Saving Expert site urged people to check if they could benefit from topping up their National Insurance (NI) contributions in the group’s latest newsletter.
People have been urged to check their NI record after a woman secured a potential £60,000 boost to her state pension payments if she lives for 20 years.
A guide from the Money Saving Expert team said the “potentially unbeatable” income boost is providing some people with increases of more than £50,000 to their income.
A person typically needs 35 years of NI contributions to get the full new state pension, which is currently £221.20 a week. You will need at least 10 years of contributions to get any state pension when you start to claim.
This means one year of contributions is worth one 35th of the full amount, or £6.32 a week. So even if you top up just one full year’s worth of NI contributions, this could increase your payments by £328.64 a year, or by £6,572.80 in total if you live for 20 years after claiming.
To first find out if you have any gaps in your NI record, you can use this tool on the Government website to check your record.
This will show you for each year since you turned 16 if you have a ‘full year’ of contributions or a ‘year is not full’ if you have a gap.
Martin Lewis (Image: Getty)
The next step is to use the state pension forecast calculator tool, as this will show how much state pension you are on track to receive given your current NI contributions.
This will also how much state pension you would get if you work up to your state pension age. The state pension age is currently 66 but this will be increasing to 67 and then to 68 over the coming years.
If you have missing NI year but are on track to get the full state pension, there is no need to top up. It may also be the case that by continuing to work until your state pension
People can boost their state pension by topping up their National Insurance contributions (Image: Getty)
Another consideration is the fact that usually you can only top up your contributions as far back as six years ago, but at present this is extended so people can top up as far back as the 2006/2007 tax year.
People can top up over this extended period until the end of this current tax year, which finishes in April 2025.
You may be able to effectively top up for free if you are entitled to NI credits, which cover your contributions in a range of scenarios, such as if you are on Universal Credit or other benefits.
More information about National Insurance credits is available on the Government website.
Topping up a full NI year usually costs £824, although this varies depending on the tax year and on your work situation.
