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This is how many years you need to work before you can retire on Full State Pension

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It might seem odd and perhaps even boring to think about pensions and retirement when you start your first job. Whether you’re a bright-eyed 18 year old, a more seasoned graduate, or an even wiser middle-aged candidate fresh on the job market, it is never too early to think about retirement.

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You just have to look at the news to see worrying stories of the employment landscape, be it the P&O Ferries mass sacking of 800 staff, or the period of uncertainty during the 18-month lockdown. If you were one of the 11.7 million staff on furlough, or you knew someone who was placed on furlough, you know first-hand how important it is to plan for the future.

A recent survey commissioned by Hargreaves Lansdown discovered some surprising statistics. It found that over one-third (34 per cent) of people aged 45-54 don’t have a plan in place for their remaining working years.

As reported by Daily Record, this compares to roughly a quarter of 35-44-year-olds and 25-34-year-olds who had no plan for the time between age 50 and retirement. Some 42 per cent of those in the 45-54 age group said they planned to continue in their current job and work full-time.

A further 10 per cent said they would stay in the same role but move to part-time hours. Only five per cent said they planned to stop work completely.

Helen Morrissey, senior pensions and retirement analyst at Hargreaves Lansdown said: “These findings point to a worrying lack of planning among those closest to retirement on how they plan to spend their remaining working years. The pandemic may well have played a part in this with the economic upheaval potentially causing chaos for people’s retirement planning with many older workers retiring early after being made redundant.

“Easing into retirement by working part-time is often a better way of managing such a huge change from a financial and emotional wellbeing perspective.” This is encouraging for those with a workplace or private pension.

However, for many who opted out, or didn’t meet the £10,000 minimum requirement for auto-enrolment, a State Pension may be their best option for a retirement income. It is important to note that eligibility is not automatic.

State Pension is a contributory payment. In 2019, data from the Department for Work and Pensions (DWP) revealed that of the 1.1 million people who claim the new State Pension, just under 500,000 (44%) receive the full amount of £179.60 a week.

The amount of State Pension people will receive depends on how long they have been making National Insurance (NI) contributions towards it. In October 2020, the UK Government raised the State Pension age to 66 for both men and women.

There are plans to increase this to 68 over the coming years. But, how many years of NI contributions do you need to make in order to qualify for the full, ‘new’ State Pension?

You will need at least 10 qualifying years on your NI record to get any State Pension. However they don’t have to be 10 qualifying years in a row.

This means for 10 years at least one or more of the following applied to you:

  • you were working and paid NI contributions
  • you were getting NI credits for example if you were unemployed, ill, a parent or a carer
  • you were paying voluntary NI contributions

If you have lived or worked abroad you might still be able to get some new State Pension. You might also qualify if you have paid married women’s or widow’s reduced rate contributions.

You will need 35 qualifying years to receive the new full State Pension if you do not have a NI record before 6 April 2016. For people who have contributed between 10 and 35 years, they are entitled to a portion of the new State Pension.

Qualifying years if you are working

When you’re working you pay NI and get a qualifying year if:

  • you’re employed and earning over £183 a week from one employer
  • you’re self-employed and paying NI contributions

You might not pay NI contributions because you’re earning less than £183 a week. You may still get a qualifying year if you earn between £120 and £183 a week from one employer.

Qualifying years if you are not working

You may get NI credits if you cannot work – for example because of illness or disability, or if you’re a carer or you’re unemployed.

You can get NI 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 are not working or getting NI credits

You might be able to pay voluntary NI contributions if you’re not in one of these groups but want to increase your State Pension amount. Find out more on the GOV.UK website here.

What if there are gaps in your NI record?

You can have gaps in your NI record and still get the full new State Pension. You can get a State Pension statement which will tell you how much State Pension you may get. You can then apply for a NI statement from HM Revenue and Customs (HMRC) to check if your record has gaps.

If you have gaps in your NI record that would prevent you from getting the full new State Pension, you may be able to:

  • get NI credits
  • make voluntary NI contributions

Check your National Insurance record here.

Check your State Pension age

Check your State Pension age using the free Gov.uk online tool here. This will tell you:

  • when you’ll reach State Pension age
  • your Pension Credit qualifying age





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