Answering your pension questions
RENFREWSHIRE CITIZENS ADVICE BUREAU ANSWERS YOUR QUESTIONS
I’m 65, and due to turn 66 in October. I’m due to receive my state pension at this age. How much will I receive?
Your state pension entitlement will depend on how many qualifying national insurance contributions you have paid in your lifetime.
In order to get the maximum new state pension amount, you are required to have 35 qualifying years of national insurance contributions.
The maximum state pension was £203.85 per week, or £10,636.60 a year. However, the UK Government has since increased this from April 2024, to £221.20 per week, or £11,502 a year.
This is an increase of 8.5 per cent, in line with the Triple lock Guarantee - a commitment from the government to increase the state pension by the highest figure of average earnings growth, inflation, and 2.5 per cent.
There are other factors which can potentially affect your national insurance record.
It is always beneficial to request a state pension forecast from the UK Government to determine if you are on track to receive the full state pension entitlement. You can request this online, by phone or post.
Details are: Telephone 0800 731 0175;
The Pension Service 9, Mail Handling Site A, Wolverhampton, WV98 1LU.
I’ve got a workplace pension with a value of around £50,000. Will this affect my state pension entitlement, or other help I might otherwise receive?
No. State pension is based on your national insurance contributions, and therefore cannot be affected by private pensions or other savings.
Regardless of how much private provision you have, you will still be entitled to your full state pension, if you have the required 35 years national insurance contributions as explained above.
Both private and state pensions are considered as taxable income, so the more pension provision you have, the more income tax you may have to pay.
It is true that people with private pensions are less likely to qualify for an income based top up on their income - known as pension credit – or housing benefit and council tax reduction, but, even then, and especially if you have ill health or are a carer, it may be worth having a benefit check to see what extra help you might be entitled to if you are approaching state pension age.
My pension pot has lost money recently, and I’m worried that I won’t have enough for retirement. Can someone review how my pension is performing?
Defined contribution pensions – also known as money purchase pensions – provide a pot of money which you can decide how and when you wish to access the funds at retirement.
The money is invested with the pension provider of you or your employer’s choice.
While the money remains invested, it is subject to market fluctuations and the value can go up or down.
You can speak to a regulated financial advisor who can provide you with advice, help with your finances and recommendations on how to invest your funds and maximise your retirement provision.
This is a chargeable service, and fees can vary depending on the pension pot size, the advice required and other factors.
The most important thing to ensure is that the financial advisor you speak to is regulated by the Financial Conduct Authority. A list of regulated financial advisors in your area can be found on the Moneyhelper website by using the retirement advisor directory.