State pensioners could add as much as £79,000 to their state pension pot if they act before April.
The government has warned that it is removing 13 years from the Voluntary National Insurance scheme from April 5, 2025.
A lot of people don’t realise that the state pension is not automatically given to pensioners at the maximum possible payout per week, and in fact, you need to have a full National Insurance record of about 35 years of paying the tax in order to qualify for a full state pension.
Currently, the full new state pension is about £221 per week, set to increase to £230 a week from April thanks to the Triple Lock.
But you don’t necessarily get the full amount unless you have a full 35 year record of paying National Insurance.
And for many who had periods where they were unemployed, raising children or working abroad, they could be missing gaps in their record which mean they don’t get the full amount.
But there is a system in place through which you can buy back missing National Insurance years for your record.
Through the Voluntary National Insurance scheme, you can buy up to 13 years for roughly £800 a year (less if you only need to pay for a partial year).
But each £800 can become £5,400 per year for a man and £6,100 a year for a woman, because the amount it increases your pension payout leads to having more money per year.
But from April, the government will close access to 13 years of NI records, meaning you can no longer buy back those years.
It could even mean some people won’t have enough National Insurance years on their record to qualify for a state pension if they miss the deadline.
If you were missing 13 years, then you bought them all back, it could mean as much as £79,100 added to your pension pot for a woman or £70,200 for a man according to Martin Lewis’ calculations from his ITV The Martin Lewis Money Show Live, based on £6,100 a year extra for a woman and £5,400 a year more for a man.
The government has warned: “You have until 5 April 2025 to pay voluntary contributions to make up for gaps between tax years April 2006 and April 2016 if you’re eligible.
“If you want to make voluntary contributions for the tax years 2016 to 2017 or 2017 to 2018, the deadline has been extended. You have until 5 April 2025 to pay.
“After 5 April 2025 you’ll only be able to pay for voluntary contributions for the past 6 years. This may not be enough to qualify for a new State Pension if you have fewer than 4 qualifying years on your National Insurance record. You’ll usually need at least 10 qualifying years in total.”
