Martin Lewis is urging people to check their State Pension forecast to see if they can boost their payments in retirement. Writing in the latest MoneySavingExpert (MSE.com) newsletter, the consumer champion explained how the amount of State Pension someone receives at retirement age is determined by the number of National Insurance (NI) years accrued.
He wrote: “Every year worked in the UK builds up National Insurance years (as can looking after your child, caring or being ill). Most people now need roughly 35 years to qualify for the full New State Pension of currently £221 per week for a single person. This payment is taxed as other income and is currently paid when you hit 66 whether you still work or not. Do check your State Pension forecast and see if you can boost your State Pension.”
HM Revenue and Customs (HMRC) announced earlier this week people plugging gaps in their NI records to boost their State Pension have contributed a total of £35 million since April last year using an online service. I
HMRC and the Department for Work and Pensions (DWP) are reminding people they have only two months left, until April 5, to check their NI record and fill any gaps stretching as far back as April 6 2006. From April 6 2025, people will only be able to make voluntary NI contributions for the previous six tax years, in line with normal time limits.
Since the launch of the digital service last April, 37,000 people have topped up more than 68,000 years of State Pension.
HMRC said analysis of the digital service found two-thirds (65%) of the years topped up so far are from 2017 onwards and the average online top-up payment made is £1,835. The biggest weekly State Pension increase made has been £113.76.
HMRC said the ‘Check your State Pension forecast’ service on GOV.UK is the fastest and easiest way people can check what their pension will be in retirement and take action if they need to. People can also use the HMRC app to check their state pension forecast.
People may also be able to receive credits if they are not paying NI and can check whether they are entitled to them on GOV.UK here.
Angela MacDonald, HMRC’s second permanent secretary and deputy chief executive, said: “There are just two months left to check and fill any gaps in your national insurance record from 2006 onwards to boost your State Pension entitlement.
People should also watch out for scammers posing as the revenue body and should never share their HMRC login details with anyone.”
Rosie Hooper, a chartered financial planner at Quilter Cheviot said: “For those with gaps in their record – especially people in their late 40s, 50s, and 60s – checking eligibility should be a priority. The average online top-up payment is £1,835, so paying a relatively small price now could have a substantial impact on your financial wellbeing in retirement.
“In some cases, a few thousand pounds paid now could translate into tens of thousands in additional pension income over retirement, making it one of the most financially rewarding decisions they can make. However, it’s crucial to ensure that paying voluntary contributions will actually lead to a higher State Pension.”
Sir Steve Webb, a former pensions minister who is now a partner at pension consultants LCP (Lane Clark & Peacock) said: “For most people who are short of a full State Pension, top-ups are generally excellent value for money, with the cost being recovered within three to four years of retiring.
“This is likely to be the last opportunity to fill gaps more than six years back, so it is worth everyone checking their pension forecast and seeing if a top-up would be worthwhile.”