Individuals aged between 45 and 72 have a terrific opportunity to boost their state pension but have until 5 April 2025 to do so.
The UK state pension currently stands at £203.85 a week per person, doubling to £407.70 for married couples. But the amount you receive will depend on the number of years you have been paying national insurance contributions.
Typically, to qualify for the full state pension most of us will need to have made 35 years of contributions, what the Government calls 'qualifying years'. It is not uncommon for people to have missed some years, perhaps through illness, time out of work to raise children or when self-employed, leaving them facing a reduced state pension on retirement.
But what many do not realise is that it is possible to plug those gaps by making voluntary national insurance contributions. And there is very good reason to do so. A voluntary contribution of just £800 could result in an additional £5,500 in your state pension.
There is, however, a limited window in which voluntary contributions can be made.
If gaps in your national insurance contributions fall between 2006 and 2016, you have until 5 April 2025 to plug those gaps. The cost of plugging those gaps has also been frozen.
Making these contributions doesn't always increase a state pension, so it is worth getting a pension forecast to see if the additional payments are worth it. Clients are urged to check their state pension with the Government's State Pension Calculator, which can be found here. It will forecast the pension you will receive and show any gaps in national insurance contributions. It will also provide a link explaining how you can boost your state pension.
There are, of course, many factors that will influence pension planning, including your age, income and other savings and investments. It is important to get professional advice before making voluntary national insurance contributions or making changes to your pension provisions.
The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.
