“A generous basic state pension is the least a civilised society should offer those who have worked hard and saved through their whole lives” — George Osborne
“A generous basic state pension is the least a civilised society should offer those who have worked hard and saved through their whole lives” — George Osborne
Receiving the UK State Pension is an important milestone for millions of people across the UK, and even those abroad. Reaching State Pension Age (SPA) represents the age at which individuals become eligible to claim their State Pension.
A State Pension is a government-provided financial benefit designed to help people during retirement.
Understanding the state pension, how it’s changing, and its implications is crucial for anyone planning their future finances.
The first important point about the UK State Pension is that it changed on the 6th April 2016 to become the “New State Pension” for those who reach State Pension age from that date onwards. This includes men born on or after 6th April 1951 and women born on or after 6th April 1953.
Before the 6th April 2016, there was the “Basic State Pension” which was for those who reached the State Pension age before that date.
As you will already be receiving the Basic State Pension if you were eligible (thus hopefully already know how much you should be receiving!), we will be looking at the New State Pension in this article.
Who is Eligible?
The New State Pension is a regular payment from the UK government to people who have reached the qualifying age after 6th April 2016 and have made sufficient National Insurance contributions (NICs) over their working life.
‘Sufficient’ NICs means that you have at least 10 qualifying years of contributions, with 35 qualifying years of contributions being required for the full New State Pension.
The UK State Pension is separate from any workplace or private pensions that you may have and, as of the date of this article, is not means-tested, so everyone with enough qualifying years, and has reached State Pension Age, is eligible.
Remember, the State Pension Age is not fixed; it has been gradually rising due to increased life expectancy and demographic changes.
In addition, each year that the State Pension Age is increased is a year that the UK Government does not have to pay the State Pension. Therefore, this saves the UK Government a significant sum of money over time.
Currently, as of the date of this article, the UK State Pension Age is:
However, if you were born before 6 April 1968, please see the below table:
We expect the State Pension Age to continue increasing over the next decades.
The “Triple Lock” is a system that was implemented by the Conservative-Liberal Democrat coalition Government in the UK back in 2010 that ensures the UK State Pension kept pace with the rising cost of living.
Under the triple lock system, the State Pension increases each April in line with the higher of:
Since July 2024, Chancellor Rachel Reeves has said the Labour government will keep the triple lock until the end of the current Parliament.
In general, you cannot claim your UK State Pension before reaching the qualifying age.
The State Pension is not flexible like some workplace or private pensions, where early access may be available (albeit perhaps with certain reductions).
However, you are not obliged to claim your State Pension pension as soon as you reach the State Pension Age. Hence, you can defer it. This may increase your weekly payments when you do decide to claim it in future.
The easiest way to check when you will be eligible for the New State Pension and how much you may receive is to:
You can continue to work after reaching the State Pension Age.
Your State Pension will not be affected by your earnings.
Furthermore, once you hit this age, you no longer need to pay National Insurance contributions on your income, which can make working more financially beneficial.
If you do not have the full 35 years of National Insurance contributions, you might still be eligible for a partial pension.
If you wish to try and increase your pension entitlement, you can consider making Voluntary National Insurance Contributions.
These voluntary payments can fill any gaps in qualifying years you may have, therefore increasing your state pension entitlement. However, these are not suitable for everyone and you should take professional advice from Patterson Mills prior to making this decision.
The UK State Pension provides a foundational level of income in retirement, but it is unlikely to be enough to maintain a comfortable lifestyle in retirement.
Hence, it is crucial to think about additional savings, like your workplace pension, private pension(s), and general savings and investments to supplement the State Pension.
With State Pension ages around the world rising at varying intervals, it is vital to talk to Patterson Mills. Contactez-nous today and book your initial, no-cost and no-obligation meeting to ensure you are making the right decisions for you.
Send us an e-mail to contactus@pattersonmills.ch or call us direct at +41 21 801 36 84 and we shall be pleased to assist you.
Please note that all content within this article has been prepared for information purposes only. This article does not constitute financial, legal or tax advice. Always ensure you speak to a regulated Financial Adviser before making any financial decisions.
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