State pension: How to build National Insurance records while being unemployed – act now
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State pension income is dependent on National Insurance records, with at least 35 years needed to receive the full amount of £175.20 per week. National Insurance is usually built up as a person works, either for an employer or through self-employment, but records can also be boosted while a person is unemployed.
Where a person is not working, they may be able to get National Insurance credits which will count towards protecting a state pension.
These credits may be awarded to those who cannot work due to certain circumstances such as illness, disability, being a carer or overall unemployment.
For example, National Insurance credits can be received if a person:
- Is claiming child benefit for a child under 12
- Get’s jobseeker’s allowance or employment and support allowance
- Get’s carer’s allowance
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Where a person may not be getting National Credits, or they’d like to boost their payments further while receiving them, they may be able to make voluntary National Insurance contributions.
Voluntary National Insurance contributions can fill gaps in a state pension record but this is not guaranteed.
The Government urges savers to contact the Future Pension Centre before taking any action to find out if the voluntary payments will actually make a difference to pension entitlement.
Voluntary contributions will be paid through either class two or class three rates, with class two costing £3.05 per week and class three levying £15.30.
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To check on potential gaps in a National Insurance, people can head to the Government’s website to use a free-to-use tool which will break down a person’s record.
This tool will require users to create a Government gateway user ID and password and when this is done, it will be possible to see:
- What a person has paid up to the start of the current tax year
- If they have any National Insurance credits already collated
- If gaps or contributions or credits mean some years do not count towards a state pension (they may not be “qualifying years”)
- If they can pay voluntary contributions to fill any gaps
So long as a person is eligible for a state pension, they’ll need to take action to receive it as they’re not paid out automatically.
Claims for state pension can be processed up to four months before a person reaches their state pension age.
Currently, the state pension age is 66 for most people but it is expected to rise in the coming years.
Under the current schedule, state pension age will rise to 67 by 2028 and 68 by 2046.
The Government details the quickest way to apply for a state pension is by going online.
However, state pensions can also be claimed over the phone or through the post.
When they are claimed, initial payments may take around five weeks to arrive.
Beyond this, full payments will arrive once every four weeks.
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