Maximise Your State Pension

For many people the State Pension will make up a significant chunk of their income in retirement. Here are three steps to make sure you get the maximum benefit from the State Pension.

Plug gaps in your record

If there was a time when you did not pay enough National Insurance contributions or get enough National Insurance credits to give you a qualifying year, you may find you have a gap on your record. You can top this up by making Voluntary 'Class 3' National Insurance Contributions - the rate for the 2019-20 tax year is £15 a week. If you have questions about whether the top-up is value for money, it is worth considering that, based on 2019-20 figures, you would only have to be in receipt of State Pension for three years to get back more than the cost of the top-up. To check your NI record go to gov.uk/check-state-pension.

Defer your state pension

Delaying or deferring your state pension could result in a higher weekly state pension or even a lump-sum payment (for those who reached state pension age before 6 April 2016). How much you get depends on your state pension age. Under the new system, for every nine weeks that you defer your state pension, you will get an increase of 1% (or 5.8% for a full year). This is less generous than the previous system.