According to the DWP, the state pension helps support 13 million older people across the UK and payments are triggered when people reach state retirement age (SAR), which is currently 66 for both men and women. To get the state pension, you will need to have paid at least 10 years’ worth of National Insurance Contributions (NICs).
The first state pension payment might also be higher or lower than expected even with full National Insurance contributions. However, people approaching the official age of retirement this year may not be aware the state pension is not paid automatically and needs to be claimed. Retirees who do not claim their state pension could face a delay in receiving their first payment of up to £230.25 each week, or £921 every four-weeks.
The money is not paid automatically because some people choose to defer their retirement in order to keep working and generate more towards their pension pot, especially if they have not paid the full quota of 35 years’ worth of National Insurance Contributions, or were ‘contracted out’.
The DWP states: “You do not get your state pension automatically – you have to claim it. You should get a letter no later than two months before you reach state pension age, telling you what to do.”
The DWP clarifies you can either claim your state pensin or delay (defer) claiming it. It states: “If you want to defer, you do not have to do anything. Your pension will automatically be deferred until you claim it.”
Which means, unless you respond to the letter confirming you want to start claiming the state pension, you will not receive any payments as the DWP will interpret no response as a wish to defer.
Deferring your State Pension could increase the payments you get each week when you decide to claim it, as long as you defer for at least nine weeks. It increases by the equivalent of 1% for every nine weeks you defer, this works out as just under 5.8% for every 52 weeks.
The extra amount is paid with your regular pension payment, however, it’s important to be aware any extra payments you get from deferring could be taxed – find out more on GOV.UK here.
It’s also important to be aware deferred State Pensions increase each year in line with the September Consumer Price Index (CPI) inflation rate and not the highest measure of the triple lock policy.
The DWP has published the full list of state pension and benefit uprated payments on GOV.UK here, which also includes additional elements such as the deferred rates, which are rising by 1.7 per cent (September Consumer Price Index inflation rate).
Full new state pension
- Weekly payment: £230.25
- Four-weekly payment: £921
- Annual amount: £11,973
Full basic state pension
- Weekly payment: £176.45
- Four-weekly payment: £705.80
- Annual amount: £9,175
Your first payment
Your first payment will be within five weeks of reaching state pension age and you will get a full payment every four weeks after. You might get part of a payment before your first full payment. The letter will tell you what to expect.
You can also choose to receive your state pension payments weekly or fortnightly which will result in a shorter delay for the first payment – find out more here.
Your State Pension payment day
The day your state pension is paid depends on your National Insurance number.
Last two digits of your National Insurance number:
00 to 19 – paid on a Monday
20 to 39 – paid on a Tuesday
40 to 59 – paid on a Wednesday
60 to 79 – paid on a Thursday
80 to 99 – paid on a Friday
DWP ‘starting amount’ for the new state pension
If you have qualifying years on your National Insurance record as at April 5, 2016, DWP works out a ‘starting amount’ for you for the new state pension.
It is the higher of either:
- the amount you would have got under the previous state pension system up to 6 April 2016, or
- the amount you would get on your record to 6 April 2016 if the new state pension had been in place at the start of your working life
Both amounts reflect any periods when you were contracted out of the additional state pnsion. Your ‘starting amount’ could be less than, more than or equal to the full new state pension
If your ‘starting amount’ is less than the full amount of the new state pension
- Each ‘qualifying year’ you add to your National Insurance record after April 5, 2016 will add a certain amount (about £6.57 a week in the 2025/26 financial year, this is £230.25 divided by 35) to your ‘starting amount’, until you reach the full amount of the new state pension or you reach state pension age, whichever happens first.
If your ‘starting amount’ is more than the full amount of the new state pension
You will get this higher amount when you reach state pension age. It is possible to have a starting amount higher than the full new state pension if you have some Additional state pension. The difference between the full new state pension and your ‘starting amount’ is called your ‘protected payment’.
