Knowing what to expect from your State Pension is an integral part of planning for life after work. For millions of retired people across Britain, the State Pension is a vital source of income. However, the system can be difficult to understand, so it’s crucial that you know how it works. If you’re looking to make the most of your income in retirement, a good place to start is with your State Pension.
This does not constitute advice and advice should be sought in all instances before acting on it.
How much is the full Basic State Pension worth?
Currently, for the 2022/23 tax year, the full Basic State Pension is £141.85 per week. There is an opportunity to increase your Basic State Pension through your spouse or registered civil partner or inherit some of your spouse’s or registered civil partner’s State Pension when they die. There is a chance you can receive £85 more if you are married or in a registered civil partnership if either of you are not receiving a Basic State Pension or you’re not receiving the full amount each week.
What is the New State Pension?
In order to claim the New State Pension, you must either be born on or after 6 April 1951 as a man or 6 April 1953 as a woman. You will need to wait until you reach the State Pension age before you’re able to receive any of your pension.
The full New State Pension in the 2022/23 tax year is £185.15 per week, which amounts to an annual income of £9,627.80. The actual amount you receive is dependent on your National Insurance record. If you have over a certain amount of additional State Pension or you defer by delaying taking your pensions, you may receive more than this amount.
How can I check how much I’m entitled to?
You can easily check your state pension entitlement as well as your State Pension age by getting a State Pension Forecast. This can be done using a Government Gateway account via form BR19, which is available on Gov.UK.
A State Pension forecast can tell you:
- How much State Pension you could receive
- When you can start receiving it
- How to increase it, if you can, by adding to your National Insurance record
As you continue to work, you can keep paying National Insurance contributions until you reach State Pension age. If you need to fill any gaps in your record, you can apply for National Insurance credits or by paying voluntary contributions. Your personalised forecast is based on the assumption that you make, or are credited with, the maximum number of National Insurance credits in the years up to your State Pension age.
How can you ensure you have enough money to retire?
After reviewing your state pension and other retirement savings, if you find that you might fall short of what you’ll need, don’t panic. You should still have time to top up your pension plan or figure out other ways to provide an income as long as you have enough time to prepare.
Start early and don’t forget to regularly review your retirement plan to make sure you’re on track. Get in touch with Dental & Medical Financial Services today to build or review your plans so you’re ready for the future.