The Department for Work and Pensions (DWP) has unveiled the latest figures, revealing that nearly 12.7 million older people across the UK are currently receiving a regular financial income from the State Pension. This benefit is accessible to those who have reached the UK Government’s eligible retirement age of 66 for both genders and have made at least a decade’s worth of National Insurance (NI) contributions.
However, many individuals approaching retirement may not be aware that they need roughly 35 years’ worth of NI contributions to receive the full New State Pension payment of £221.20 per week.
This amount is an average as some individuals may have been ‘contracted out’ and will require more NI contributions to qualify for the full sum – further details about this can be found on GOV. UK.
While workplace and private pensions can supplement the State Pension in retirement, many people might be relying solely on this contributory benefit as their only income during their retirement years. Therefore, it’s crucial to understand how many years of NI contributions are needed to secure the maximum payout.
The State Pension age is set to increase to 67 between 2026 and 2028, with another planned rise to 68 expected to take place in the mid-2040s, according to the Daily Record.
If you’re worried about the number of years you need to work before retirement, our guide below will help clarify how National Insurance contributions affect your State Pension amount.
How to qualify for any New State Pension payment
To be eligible for any State Pension, you’ll need at least 10 qualifying years on your National Insurance record, but these don’t have to be consecutive.
This means that for at least 10 years, one or more of the following applied to you:
- you were employed and made National Insurance contributions.
- you received National Insurance credits, for instance if you were jobless, ill, a parent or a carer.
- you made voluntary National Insurance contributions.
Even if you’ve lived or worked overseas, you might still be able to receive some New State Pension.
You may also qualify if you’ve made contributions at the married women’s or widow’s reduced rate – find out more about this on the GOV. UK website here.
How to qualify for full New State Pension payments
The first thing to understand is that ‘full’ refers to the maximum amount of New State Pension a person can receive. You’ll need approximately 35 qualifying years to receive the full New State Pension if you don’t have a National Insurance record before 6 April 2016 – this could be more if you were ‘contracted out’, find out more here.
For those who have contributed between 10 and 35 years, they are eligible for a portion of the new State Pension, but not the full amount unless they purchase additional NI years.
Qualifying years if you’re employed
When you’re working, you pay National Insurance and earn a qualifying year if:
- you’re employed and earning over £242 a week from one employer.
- you’re self-employed and making NI contributions.
You might not be paying National Insurance contributions because your earnings are less than £242 a week. However, you may still earn a qualifying year if you make between £123 and £242 a week from one employer – find out more here.
Qualifying years if you’re not employed
You may receive National Insurance credits if you’re unable to work – for instance due to illness or disability, or if you’re a carer or unemployed.
You can receive National Insurance credits if you:
- claim Child Benefit for a child under 12 (or under 16 before 2010)
- get Jobseeker’s Allowance or Employment and Support Allowance
- receive Carer’s Allowance
If you’re not employed or receiving National Insurance credits
You might have the option to make voluntary National Insurance contributions if you’re not in one of these groups but wish to increase your State Pension amount. Find out more on the GOV.UK website here.
What happens if there are gaps in your National Insurance record?
Even with gaps in your National Insurance (NI) record, you can still be eligible for the full New State Pension. A State Pension statement can provide an estimate of how much State Pension you might receive.
You can also request a National Insurance statement from HM Revenue and Customs (HMRC) to verify if there are any gaps in your record.
If your National Insurance record has gaps that could hinder you from receiving the full New State Pension, you may have options such as:.
- Acquiring National Insurance credits
- Making voluntary National Insurance contributions
You can review your National Insurance record on the GOV. UK website here.
It’s also important to check your State Pension age to determine when you’re eligible to retire and claim your State Pension. This can be done using the free online tool available on the GOV.UK website here.
