Maximise Your State Pension – Are You Getting Your Fair Share?

The complexities of state pensions can be daunting, but it’s crucial to ensure you’re receiving the correct amount. Steve Webb, a former Pensions Minister and expert, writing in the Daily Mail, sheds light on the ‘magic minimum’ pension amount and advises on actions to take if you’re receiving less.

Understanding the ‘Magic Minimum’ Pension

  • Minimum Pension Amount: The essential figure to remember is £93.60 per week. This is the ‘magic minimum’ pension rate that the majority of pensioners should be receiving.
  • Time for a Check: The New Year is an ideal period for pensioners to review their state pension and confirm they’re receiving this minimum amount.
  • Completed Checks: The Department for Work and Pensions (DWP) claims to have concluded error checks for key pensioner groups, particularly married women and those over 80.

Are You on the Right Pension?

  • Take Action: If your pension is below £93.60, it’s time to reach out to the Pension Service. This is especially crucial for women who suspect underpayment and have been previously advised to wait for DWP’s contact.

Old State Pension System, Pre-April 2016

Eligible Groups

  1. Over 80s: If you’re over 80 and meet basic UK residence criteria, you’re entitled to at least £93.60, regardless of your NI contributions, income, or marital status.
    • Residence Criteria: This includes 10 years of UK residence within a 20-year period around your 80th birthday.
  2. Married Women: Women with husbands over the state pension age and possessing a full basic state pension qualify for a £93.60 ‘married woman’s pension’.
    • Note: The amount varies if the husband’s pension is less than the full basic rate (£156.20 per week).

DWP’s Correction Exercise

  • Pension Errors: Investigations uncovered that these two groups often received incorrect pensions.
  • Correction Progress: As of October 2023, DWP has corrected underpayments for thousands, distributing over £270 million in arrears.

New State Pension System, Post-April 2016

Key Requirements

  • 16 Years of NI Contributions: Generally, if you’ve contributed or received credits for at least 16 years, your pension should be around £93 or more.
  • Missing NI Credits: Underpayments may occur due to unaccounted National Insurance credits, particularly for years spent at home with children. Claiming these credits can rectify your pension amount.

Special Cases

  • Married Woman’s Stamp: Women who paid the ‘married woman’s stamp’ 35 years before reaching state pension age are entitled to a £93.60 pension. However, some cases might have been overlooked by DWP.

Taking Action

If you’re receiving less than £93.60 per week, it’s vital to:

  • Contact the Pension Service for a review.
  • Claim any missing NI credits.
  • Be proactive, especially if previously advised to wait for DWP contact.

Remember, the New Year is an excellent time to address these issues and secure the pension you deserve.