The State Pension age is set to rise between 2026 and 2028, with a further rise phased in between 2044 and 2046
The State Pension age is due to increase from 66 to 67 for both men and women between 2026 and 2028, with a further rise to 68 expected to be phased in between 2044 and 2046. This indicates that individuals born between March 6, 1961 and April 5, 1977 will be eligible to claim their State Pension as soon as they turn 67.
However, research conducted by retirement specialist Just Group reveals that over a third of retirees did not check their State Pension forecast before retiring, despite the fact that 1.2 million households depend on the State Pension as their main source of income during retirement.
The study, which surveyed more than 1,000 retired and semi-retired individuals aged over 55, discovered that four out of ten (38%) had not checked their forecast. This figure rose to 40 per cent among those who had not yet reached State Pension Age (55-64 year olds) and 46 per cent for those who claimed to have retired earlier than anticipated.
Among the two-thirds of retirees who did check their projected State Pension income, nearly one fifth (17%) reported it was – at least – £250 less per year than they had anticipated. Conversely, one-in-ten (9%) retirees stated it was at least £250 more per year than they had expected.
Stephen Lowe, group communications director at Just Group, weighed in on the report, stating: “It’s easy to see why people may assume they’ll simply get the full State Pension, but for many people this won’t be the case. The last thing these households need when they come to retire is the nasty surprise that their State Pension is less than they thought”, reports the Daily Record.
He also noted, “The government offers a State Pension forecast service and we urge anyone approaching retirement to use it – ideally in advance of beginning to retire. It will tell you if you are likely to receive less State Pension than you thought and that will give you the opportunity to take steps to increase what you will actually receive.”
You can check your State Pension forecast online at GOV.UK here.
State Pension payments 2025/26
The DWP has published the full list of State Pension and benefit uprated payments on GOV.UK here, which also includes additional elements such as the deferred rates, which are rising by 1.7 per cent (September Consumer Price Index inflation rate).
Full New State Pension
- Weekly payment: £230.25 (from £221.20)
- Four-weekly payment: £921 (from £884.80)
- Annual amount: £11,973 (from £11,502)
Full Basic State Pension
- Weekly payment: £176.45 (from £169.50)
- Four-weekly payment: £705.80 (from £678)
- Annual amount: £9,175 (from £8,814)
Future State Pension increases
The Labour Government has pledged to honour the Triple Lock or the duration of its term and the latest predictions show the following projected annual increases:
- 2025/26 – 4.1% confirmed, the forecast was 4%
- 2026/27 – 2.5%
- 2027/28 – 2.5%
- 2028/29 – 2.5%
- 2029/30 – 2.5%
Step-by-step guide to boosting State Pension payments
Here is a five-step guide for men born after April 5, 1951, and women born after 5 April 1953, to help them decide whether it’s worth buying voluntary National Insurance (NI) credits to make up any missing years.
Step 1: Review your State Pension record.
There are numerous reasons why there might be a gap in your NI record – from taking a career break or time off to raise a family, to caring for elderly relatives, living and working overseas, earning a low income or being self-employed and not paying contributions due to a low income.
The risk of having gaps is that you may not accumulate enough qualifying years to receive a full State Pension. Typically, Brits need at least 10 years of NI contributions to receive anything at all and a minimum of 35 years to receive the maximum amount, currently set at £11,502 annually.
It doesn’t have to be 35 consecutive years, but you must reach that target over your working life to receive the full entitlement.
If you haven’t reached State Pension age yet, simply review your NI contribution record by logging onto the State Pension forecast calculator, accessible through your Government Gateway here.
You’ll receive a State Pension summary detailing the year you’re eligible to receive a State Pension with a guide on the amount you’ll receive weekly, monthly and annually (without considering inflation) based on your current and projected contribution level.
The summary also details the amount you would receive if you continued to contribute and the necessary steps to improve the forecast in case of any shortfalls.
For those who have already reached State Pension age, they can simply review their National Insurance record for any incomplete years since 2006.
Step 2: Evaluate if filling any NI gaps is beneficial.
Your State Pension Summary will clearly indicate how many years of contributions you already have, how many you have left to contribute before retirement and the number of years where your contributions were insufficient.
These will be labelled as ‘Year is not full’ with advice on how much you need to pay in voluntary contributions for each year by April 5.
Whether you need to make these payments depends on factors such as how many more years you plan to work. Those aged 45 and over who are nearing retirement age and won’t have enough time to achieve 35 qualifying years to receive the full New State Pension may be more inclined to top up, while someone close to retirement and in poor health might not see it as worthwhile.
For younger individuals, it may not be worth the cost of filling the gaps as they will reach the 35-year contribution target anyway over their working life or through NI credits. For them, buying now would be a real gamble unless they are certain they won’t makeup the shortfall later, for instance, because they live abroad.
Which years you have missed is also key:
- If you have gaps between the 2006/07 and the 2016/2017 tax years, these will no longer be available to buy back after midnight on April 5, 2025, so prioritise them first. After that the number of extra years that can be filled drops down to the last six tax years, which gives you more time to plug missed years between April 2017 and today.
- Ultimately, any potential gain from buying voluntary NI contributions will be wiped out if your health is poor and you are unlikely to live long enough to benefit – with the breakeven point for buying back one year to make financial sense three years after you start claiming your State Pension.
There are also other complexities to consider:
- If you are a higher earner, it might not be worth topping up your NI record as it could tip you into a higher tax bracket when you receive your State Pension income taking you longer to break even on voluntary top ups.
Step 3: Get bespoke advice before making a decision.
Working out whether to top up can be baffling and ultimately there’s no sense in paying for more years than you need because you won’t see that money again.
The best course of action is to ring the UK Government’s Future Pension Service on 0800 731 0175 to double check how many years you can purchase and whether voluntary contributions will boost your State Pension. Those who have already hit retirement age must get in touch with the Pension Service on 0800 731 0469.
What you might discover when you speak to a government pension expert is that you’ve accumulated more years than you thought as you can also rack up NI years for free by earning tax credits.
Scenarios that could potentially earn you NI credits include:
Scenarios that can potentially earn NI credits include:
- Being a parent or guardian registered for child benefit for a child under 12
- Being on Statutory Sick Pay
- Looking for work
- Fostering a child or caring for a sick or disabled person
- Being on jury service
- Being on maternity, paternity or adoption pay
- Being wrongly imprisoned
While there are certain conditions for each scenario, NI credits can often be automatically applied, so it’s always smart to submit a manual claim if they’re not on your record. Your advisor can discuss this with you and provide guidance for your unique situation and whether purchasing a missing year will actually increase your eventual state pension.
Step 4: Calculate the cost of topping up.
For most people the cost to make up a full year by April 5 is:
- £824.20 for gaps between 2006/07 to 2019/20
- £795.60 for gaps between 2020/21
- £800.80 for gaps between 2021/22
- £800.80 for gaps between 2022/23
This rate of NI contribution is known as Class 3. However, the rate of National Insurance contributions varies depending on individual circumstances. Full-time employees pay Class 1 NI contributions, which are earnings-based and automatically deducted by their employer.
Self-employed individuals pay Class 2 and 4 based on their taxable profits, while those residing abroad pay Class 2.
Class 2 is significantly cheaper, costing around £160 for a year, compared to Class 3. Considering that each qualifying year of NI adds approximately £275 annually or £5.29 weekly to your State Pension for life, it’s clear to see the value in buying back any missed years.
Meanwhile, for those who have retired abroad, they must pay Class 3 NI rates for any missed years – find out more about this on GOV.UK here.
Step 5: Making the payment.
Once you’ve decided how many years you want to top up and which specific ones, get in touch with HMRC to find out the cost and how to obtain the 18-digit reference number required to make a payment. This ensures the amount is recorded on your NI record.
This number can be provided to you via a phone call or by post, but do allow a minimum of two weeks for it to arrive if sent by mail.
Once you’ve got the 18-digit number in hand, you can settle the outstanding years through an online bank transfer, directly from your bank or building society, or by sending a cheque to HMRC.
Full details on plugging gaps in your NI record can be found on GOV.UK here.