The State Pension is a qualifying benefit provided by the UK government.
To claim it, you need to build up National Insurance credits first - this can be done by working and paying tax, looking after children, receiving certain benefits, or while you're on jury service or maternity/paternity for example.
Once you build up enough National Insurance credits you'll be able to claim the weekly payments once as you've passed State Pension Age.
State pension age for men and women is currently 66, although this is set to rise to 68 over the next few years.
The amount you get depends on how long you have been paying National Insurance (NI).
To get the full new State Pension of £179.60 a week, you need to have paid National Insurance for 35 years.
You get about £5 a week* for every year you have paid National Insurance.
If you want to know exactly how much State Pension you could get, contact the Department for Works and Pensions on 0345 300 0168 or visit the GOV.UK website.
* Calculated using maximum pay out of £179.60 divided by 35 (years) = £5.13
This is also based on how long you have paid National Insurance, but you may have the option to top up your contributions to qualify for the maximum amount.
To get the full basic State Pension of £134.25 a week, you need to have paid National Insurance for 30 years.
You may also qualify for the Additional State Pension on top of your basic State Pension. Find out more on the GOV.UK website.
Since 2010 Governments have promised to increase State Pension payouts by at least 2.5% a year.
They have also said that if average prices or earnings rise by more than that, pensions will rise by the highest of the three numbers.
This so-called "triple lock" is designed to make sure pensioners do not become poorer either relative to people in work, or as a result of rising prices of things like food and fuel.
However, the earnings element of the triple lock has been suspended for 2022 after wages rose 8.3% in 2021 - as a result of millions of people returning to full time work having been on furlough the year before.
The Government said the decision to suspend the triple lock was made to stop pensioners "unfairly benefiting from a statistical anomaly" and the earnings element would return next year.
If you work for someone as an employee you may need to pay class 1 National Insurance depending on how much you earn, for example:
|Weekly pay||NI rate|
|£183 to £962||12%|
|Over £ £962||2%|
A plan to add an extra 1.25 percentage points to National Insurance to help pay for social care has been announced. The extra tax is not set to be applied until April 2022.
You will pay either class 2 or class 4 contributions which you pay through your self assessment form at the end of the tax year.
The amount you contribute depends on your profits for the year:
Class 2: Profits over £6,475 a year, you pay £3.05 a week.
Class 4: Profits over £9,501 a year, 9% on profits between £9,501 and £50,000; 2% on profits over £50,000
This depends on your type of employment:
If you are employed, your employer is responsible for paying National Insurance to HMRC on your behalf.
If you are self-employed then you are responsible for declaring your income and paying National Insurance.
Your National insurance is paid to HMRC and gives you a State Pension when you reach your pension age.
If you did not pay enough National Insurance over the last six years, you can usually pay a lump sum to make up the difference.
Find out more on topping up your National Insurance contributions on the GOV.UK website.
As well as paying for your State Pension, it also goes towards other benefits such as:
For more information on National Insurance visit the GOV.UK. Website.
You can start claiming your State Pension after you reach State Pension age - currently 66.
You do need to actively claim once you pass pension age, however. If you don't your pension will be automatically deferred.
If you defer your State Pension, you could get larger payments when you do start claiming as a result.
However, you will need to live long enough for the extra payments to make up for the ones you deferred, and should be aware that the increased payments could be be subject to tax.
You can help ensure you have the retirement you want by finding the best personal pension plan to make your money work as hard as it can.