Thinking about the future
If you’re not working or considering giving up work to care for someone, it is important to think about how this may affect your savings in the future in the form of a pension. We explain what options are available to you and suggest ways to ensure you can still contribute to and protect your future pension.
Will I receive a State Pension?
Not everybody automatically qualifies for a full State Pension on reaching retirement age. The amount of State Pension you get usually depends on how many qualifying years of National Insurance (NI) you have built up over the years.
If you miss paying these because you have taken time out of paid work, then you may lose out.
However, if your employment ends because you are caring for someone who is disabled, ill or frail then the state can credit your NI contributions for you. However, this isn't automatic and only happens if you claim the right benefits and take the right action.
What is the new State Pension?
The new State Pension came into effect on the 6 April 2016 and means that anyone who reaches state pension age after this date will claim the new State Pension.
Anyone who reached state pension age before 6 April 2016 (including those who have deferred claiming their pension) will stay on the ‘old system’ often referred to as the basic State Pension, i.e. they will keep the State Pension they already have. No-one will be transferred on to the new State Pension, and the old style, basic State Pension will still be uprated each year in the same way as now.
Do I qualify for a State Pension?
To claim the new State Pension, you would normally need to have at least 10 years’ worth of qualifying National Insurance contributions (not necessarily in a row). Find out more about the eligibility criteria here: www.gov.uk/new-state-pension
The maximum amount is currently £221.20 (2024/25).
Here you can find out when you are likely to reach: State Pension age.
Slightly different rules apply if you reached State Pension age before 6 April 2016 (no matter what your gender). In terms of the basic State Pension, the maximum you can get is £169.50 per week but there may be ways to increase this.
You need to have 30 qualifying years of National Insurance (NI) contributions or NI credits to receive the full basic State Pension. Those with fewer than 30 qualifying years get a proportionate amount.
Many people receive more than the basic State Pension, because the 'old rules' included an Additional State Pension (previously known as SERPS or the Second State Pension). It is paid to people who have paid over a certain level of NI contributions per year, or who have received certain benefits, or who have had their contributions paid for them.
More information about pensions
To get the maximum amount of £221.20 a week, you must have paid NI contributions and/or had NI credits for 35 years.
You need at least 10 years’ worth to be able to claim something. If you have between 10 and 34 years of NI contributions or NI credits, you will receive a proportionate amount of the maximum new State Pension.
Unlike under the 'old rules', the new State Pension does not have any additional amounts that can be added to it.
In each tax year there is a minimum amount or ‘lower earnings limit’ that you have to be earning in order to make the right amount of NI contributions.
The lower earnings limit is £123 a week (2024/25 rate), so for a whole tax year this is £123 x 52 weeks = £6,396. If you have earned at least the minimum amount in any year, that year will usually be a qualifying year for your pension and will count towards the total qualifying years needed.
Your NI record will be protected if you receive certain benefits, including:
- Carer’s Allowance
- Universal Credit
- Jobseeker’s Allowance
- Employment and Support Allowance
So if you are receiving one of these benefits, you do not need to take any action to protect your pension. It is done automatically as you will be ‘credited’ with NI contributions. This means that a contribution is put on your record equal to the lower earnings limit.
If you don’t receive these benefits, see: ‘What happens if I don’t earn anything and don’t receive any benefits?’
If you are a carer in this situation, you can claim something called Carer's Credit. This will protect your right to a State Pension even if you are not working or claiming benefits.
See our Carer's Credit section for further information.
You may have gaps in your NI record if:
- you have had breaks in paid employment that are not totally covered by benefits
- you have spent time caring without realising you were entitled to benefits
- you have had periods on low level earnings i.e. paid below the level at which you pay NI contributions.
Contact our helpline if you have any particular concerns – for example, it may be helpful to have a benefits check: advice@carersuk.org. Also see our top tips on planning for your State Pension.
Our top five tips on planning for your State Pension
Tip 1:
Make sure you receive all the relevant benefits you are entitled to. Please email Carers UK's Helpline team to arrange a benefits check: advice@carersuk.org
Tip 2:
If you are not paying NI contributions through employment, and are not receiving benefits that give you NI credits, check whether you can claim Carer's Credit (see the Carer's Credit section for further information).
Tip 3:
Check your NI record either online, by contacting the NI Helpline on 0300 200 3500 (textphone: 0300 200 3519) or by writing to HM Revenue and Customs (HMRC) (you can see the address here).
Tip 4:
Ask for a State Pension forecast either online, by contacting the Future Pension Centre on 0800 731 0175 (textphone: 0800 731 0176) or by writing to the Future Pension Centre (you can download the form and see the address here).
Tip 5:
Look into what else you could be doing for your State Pension - contact the Pensions Advisory Service for impartial advice.
