600,000 rushing to boost state pension
MORE THAN 600,000 people have paid to boost their state pensions since the flat rate system was introduced in 2016, new figures show.
But hundreds of thousands who haven’t done so yet risk missing out on the chance to fill old gaps in their National Insurance (NI) contributions ahead of a deadline next month.
The full state pension is paid to those with at least 35 years’ worth of NI contributions. Anyone falling short can pay to fill in gaps for specific years.
It costs £15.85 for a missing week of NI, adding up to £826.50 for a full year. This boosts your pension by £275 a year, or £5,500 over a 20-year retirement.
Normally you can only pay for the last six years, but a special concession allows savers to fill gaps for an extra decade, back to 2006. This extension ends in April, so savers have a month to make top-ups for those years.
one in three pensioners on the ‘ basic’ state pension did not receive the full stipend as of March 2020, according to official data. This is equivalent to 3.8 million people.
A freedom of information request submitted by wealth manager Quilter found that on average, 123,000 people pay for the boost every year.
It would cost more than £8,000 to fill a ten-year gap, but it would result in a £55,000 boost over a 20- year retirement, according to Quilter. Check your NI record at: gov. uk/ checknational-insurance-record.