If you’ve paid or been credited with UK National Insurance (NI) contributions throughout your working life, you should receive a State Pension.
You can start receiving this pension once you reach the “State Pension Age”.
For men, this is currently 65.
For women, this depends on when they were born:
- For women born before April 1950, it is 60
- For women born between April 1950 and December 1953,
the State Pension Age has been rising. In April 2010 it was 60 and by
November 2018 it will be 65
For both men and women, the State Pension Age is set to rise further in the future:
- For dates of birth between December 1953 and October 1954, it will begin to increase from 65. Depending on when the individual was born during that period, they will reach State Pension Age between March 2019 and September 2020 and will be aged between 65 and 66
- For dates of birth between October 1954 and April 1968, it will be 66.
For dates of birth after April 1968, more increases in State Pension Age are planned, rising to 67 and 68.
There are two elements to the State Pension – the Basic State Pension and the Additional State Pension.
Basic State Pension
- The Basic State Pension is exactly that – basic:
- In the 2013/14 tax year, a full basic pension amounts to just £110.15 a week for a single person
- For a couple it comes to £176.15 a week, based on a husband’s contributions, or £220.30 per week if both have paid full contributions
- These add up to only £5,737.80 a year for a single person, or £9,159.80 a year for a couple based on a husband’s contributions
- And, depending on your circumstances and contribution history, you might not receive the full amount at retirement.
Additional State Pension
The Additional State Pension is an extra pension you might get with your Basic State Pension. The amount depends on (i) how many years of National Insurance contributions you have, (ii) your earnings and (iii) whether you’ve contracted out of the scheme.
Once you reach State Pension Age and claim the Basic State Pension, you’ll also get any Additional State Pension that you’re eligible for.
- The Additional State Pension is made up of two schemes:
- State Second Pension (S2P) which started in 2002 and is still available
- State Earnings Related Pension Scheme that started in 1978 but was replaced in 2002 with S2P
- You might have contributed to both of these schemes, depending on how long you’ve been working.
- Building up a State Second Pension depends on a number of factors, including:
- Being employed with earnings of at least the Lower Earnings Limit – £5,668 a year for 2013/14
- Certain carers and people with a long-term illness / disability are eligible
- Self-employment does not qualify for S2P.
- You won’t get the Additional State Pension if you’ve contracted out of it:
- If you only contracted out for certain periods, you’ll get a reduced amount
- Since April 2012, it hasn’t been possible to contract out using a money purchase or personal pension/stakeholder plan. It has only been possible to contract out using a final salary scheme
- From April 2016, it will no longer be possible to contract out using a final salary scheme.
Did you know?
- You can find out what your State Pension Age will be by using The Pension Service’s online pension age calculator. The Pension Service is part of the Department for Work and Pensions (DWP)
- You can also ask The Pension Service for a forecast of how much your State Pension will be when you reach State Pension age – by post, telephone or online – and most people can find out online. For details of how to do this, see their pension forecast.
Boost your retirement income and be better prepared
For most people, the State Pension won’t be enough to allow them to live comfortably in retirement – let alone to achieve any bigger retirement goals. That’s why the Government is trying to encourage us to save more for our later years.
On these pages, we’ll guide you through the key pension products and other financial products you can invest in to supplement your State Pension(s).