A £6,000 "urgent issue" warning has been sent to state pensioners for a mistake that cost them THOUSANDS. Experts have also warned that time is running out for Department for Work and Pensions (DWP) claimants to improve their circumstances.
State Pensioners Encouraged to Assess National Insurance Contributions
Savings guru Kevin Mountford, who co-founded the online savings platform Raisin UK, advises state pensioners to thoroughly assess their National Insurance contributions. According to him, this seemingly insignificant job is the key to unlocking thousands of pounds in benefits, especially when it comes to ensuring your State Pension.
Mountford underlines the importance of this examination, adding that any gaps in your National Insurance record could result in you missing out on the full State Pension or some crucial benefits. Mr Mountford said: “Gaps in your National Insurance record could mean you will not have enough years of contributions to claim full State Pension or even qualify for some benefits.”
He also advocates researching ways to increase your National Insurance contributions, saying: “While boosting your National Insurance contributions doesn’t sound like a particularly exciting thing to do with any leftover money, it could earn you thousands of pounds. Putting in a full-year Class 3 contribution at £824 could make you £328 per year towards your pre-tax pension - that could add up to over £6,000 before you retire.
“To see if you’d benefit from purchasing missing National Insurance years, you should first check both your National Insurance record and your State Pension forecast on the Gov.uk website. It’s vital you periodically review your National Insurance record going forward for any gaps, helping you secure a better pension when the time arrives.”
Mountford encourages state pensioners to begin the process by reviewing their National Insurance record and State Pension prediction, which will allow them to identify any gaps and take the appropriate steps to close them, resulting in a more secure financial future.
Parenthood and Pension Disparity: Navigating Financial Challenges for Women
In addition to these findings, Raisin UK's research reveals an intriguing disparity: women without children typically have a larger pension portfolio at the conclusion of their careers than those with children. This is due to the financial burden that often comes with parenthood, with women losing an average of £783 per year after having a kid.
Considering this, it's no wonder that more than 43 million women may find themselves behind on National Insurance contributions, potentially forcing an extra year of work to catch up. This highlights the necessity of prudent financial planning, particularly when it comes to safeguarding your pension for the future.
