Britons who are hoping to boost their state pension have been urged to make a “really important” check with the Department for Work and Pensions (DWP) first.
A retirement expert said people should speak to the department to find out whether they are likely to benefit from voluntary National Insurance contributions before they shell out for them.
Helen Morrissey, head of retirement analysis at Hargreaves Lansdown, issued the warning, as she explained how people may be missing out on thousands of pounds in state pension entitlement.
How much state pension someone gets is dependent on a person’s National Insurance record.
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If a person is missing years of qualifying years on their National Insurance record, it may be they can claim National Insurance credits or make voluntary National Insurance contributions, which can boost state pension entitlement.
Ms Morrissey explained: “The state pension is the foundation of people’s retirement income but not everyone gets the full amount due to time out of the workforce or because they were contracted out.
“How much state pension you receive is based on your National Insurance record and you [typically] need 35 years’ worth of contributions for a full new state pension.”
The retirement analysis expert suggested people get a state pension forecast, which can be done via the Government website, to show how much they are on track to get, as well as identify any gaps they plan to fill.
Ms Morrissey said: “In terms of filling any gaps the first thing to do is check to see if you qualified for a benefit that comes with a voluntary National Insurance credit. Child Benefit or Universal Credit are key examples.
“If you were eligible then you can look at whether you can backdate a claim and get the necessary credits.
“You can usually buy voluntary NI contributions for the past six tax years but there is currently an opportunity for men born after April 5, 1951 or a woman born after April 5, 1953 to plug gaps going back to 2006.
“The ability to do this expires on April 5, 2025 so if you think you can benefit from this then be sure to get in contact in plenty of time.”
Issuing a warning to people to make sure they will actually benefit from voluntary National Insurance contributions first, Ms Morrissey said: “It’s really important to check with the DWP first to make sure you really will benefit from the extra credits.
“If you were contracted out at any point in your working life, then you may find you get less state pension than you thought.
“Contracting out was a feature of the old state pension system.
“You were allowed to opt out of the state second pension (also known as SERPS) in return for paying less National Insurance.
“You paid less National Insurance, which may affect your state pension entitlement, but in return, you could receive extra from your workplace/ personal pensions instead.
“It may be the case that even paying for extra National Insurance contributions will not boost your state pension amount so it’s worth checking.”
