State Pension

The basic state pension is a provided by the Government and funded by national insurance contributions. At retirement it pays a weekly income and the most you'll currently get is £113 a week for a single person. The characteristics of the state pension are:

  • It is not means tested. You get it when you reach the retirement age (60 or 61 for women and 65 for men) and it continues until you die
  • By working and paying NI contributions, you earn NI years and the amount you’re entitled to is calculated by the number of NI years you’ve accumulated. If you’re short of your NI years you won’t get the full amount:
    • For 2014/15, you need to earn £5,772 for employees and £5,885 for the self-employed for a year to be an NI Year
    • You need 30 NI years at retirement (35 years from 2016 onwards)
  • The pension amount increases every April. The percentage increase is determined by taking the higher of:
    • The inflation rate at the previous September
    • The increase in average earnings,
    • 2.5%
  • You don't have to take your state pension straight away and by delaying you can increase the amount

If you are considering supplementing your state pension with a Private Pension, we strongly advise that you seek professional advice from a fully qualified and regulated Independent Financial Advisor. Pension decisions are usually a major financial decision that requires the appropriate level of advice to make the right choice. In contrast, mistakes can be costly. To arrange for a no obligations, initial free telephone consultation click here.