Martin Lewis issues state pension warning to anyone born before 1979 | Personal Finance | Finance
Martin Lewis is urging people to check if they can add as much as £74,000 or more to their state pension – but only if they are the right age.
The money saving expert has explained how the deadline is fast approaching to buy back missing National Insurance years in your personal record with the taxman.
Because the amount you get in your state pension depends on how many years of National Insurance contributions you have on record, if you’re missing years from your back catalogue, you could boost your state pension massively by buying them back.
For every £800 you spend on buying a missing year, you could add £6,100 per year on average to your pension pot, Martin told his fans.
And how worthwhile it is will increase as you get closer to retirement age. If you’re not over 45 – so born after 1979 – it ‘probably isn’t worth doing’ unless you have large gaps in your NI history.
Martin said that the deadline is rapidly approaching in April 2025, which may seem like a long time but it can take months to sort out and get it confirmed and the deadline is completely inflexible, so if you miss it, you won’t be able to ever boost your pension with those missing years.
Martin told his viewers: “If you have gaps between 2006 and 2018, you need to think about this this year because you can only do it until next April.
“If you’re nearly at the state pension age it’s easy to see, it’s pretty obvious that you should be buying them.”
“The older you are, the more likely you should be. If there are no gaps after 2019, then you could buy those so you could wait and see.”
“If you’re under 45 this probably isn’t worth doing, unless you’ve got very cheap partial years, if you’ve got a year available for £16 just go and buy it because it’s so cheap just in case you miss years in the future because it’s so cheap for what it could be worth.”
“You need a minimum 10 years to get a state pension so a warning here.
“IF you’ve only got three years, and you’ve got three years missing, there’s no point buying those three years because you’ll still only be on six years and you still won’t get the state pension.
“If however you’re on nine years and you can buy a year, suddenly you’ll have 10/35ths of your pension and it will be massively lucrative, worth £3,000 a year for £800. So if you’ve got very limited years it could either be very lucrative or not lucrative.”
If you added £6,100 to your state pension per year, this could be as much as £74,000 more to live on for the rest of your life if you live to average life expectancy for a woman, Martin had said.
