State Pension is a regular payment from the Government that you can claim when you reach retirement age. The amount of State Pension you’ll get depends on how many qualifying years of National Insurance payments you have. The most you can currently receive from the Government is £129.20 a week.
How to top up your State Pension with new pension scheme
There are different types of schemes available which can help save up for later in life.
To top up your State Pension, retirees will have to regularly pay a part of their monthly wage into the scheme.
These schemes can either be run by an employer or you can set it up privately.
The amount pensioners will receive from a pension scheme depends on what type of scheme they are part of.
One scheme, called the defined benefit pension scheme, lets retired workers receive a specific level of income – worked out based on factors such as the final pensionable salary and the number of years of pensionable service.
Another option is a defined contribution pension scheme, which can be used to build up a personal pot of money, which will have good tax advances, but could go up or down.
When you reach retirement age the amount you will receive depends on how long you’ve paid in for and how well the investments have worked.
Pension schemes are set up to provide retired workers with an income in addition to the money received from the Government through State Pension.
The amount of State Pension you get depends on your National Insurance record.
Your National Insurance record includes National Insurance contributions that you pay when you are working and contributions that are credited to you when you are unable to work.
The highest amount you can get for your basic State Pension is £129.20 a week.
You need 30 years of National Insurance contributions to be eligible for the full basic State Pension.
However, if you have gaps in your insurance record, you may be able to make voluntary contributions to increase your pension.
Deferring your State Pension could also increase your payments when you decide to claim and will increase by one percent for every five weeks you defer.