The State Pension serves as a valuable foundation for your retirement income, supplementing your personal savings and investments.

Indeed, your State Pension can significantly enhance your financial stability in later life, yet the disparity of payments among recipients is considerable.

Most pensioners in receipt of the full State Pension typically receive £11,502 for the 2024/25 tax year (rising to £11,904 in 2025/26).

However, a report in Love Money found that a handful of older UK pensioners, on the old State Pension system, are receiving an annual State Pension worth £52,000. At the other end of the scale, around 1,100 pensioners qualify for just 10p or less a week.

This discrepancy is largely down to the number of qualifying years of National Insurance contributions (NICs) made, and decisions to defer the State Pension.

While certain factors affecting the State Pension, such as whether you qualify for the new or old system, are beyond your control, there are still steps you can take to make the most of your entitlement.

Read on to discover three simple tips to help you maximise your State Pension.

1. Make sure you have enough qualifying years of National Insurance contributions

The first thing to check when looking to maximise your State Pension is that you have made sufficient NICs to qualify.

If you reached State Pension Age after April 2016, you’ll benefit from the new State Pension system. For those on the old system, the amount you’ll receive is determined by your qualifying years and in-work earnings.

Within the new system, you normally need at least:

• 35 qualifying years to receive the full State Pension, currently £221.20 a week, rising to £230.30 a week in April 2025
• 10 qualifying years to qualify for the minimum State Pension, currently £63.20 a week.

If you have between 11 and 34 years of contributions, you’ll be eligible for a sum in-between those two figures.

It can be easy to miss years if you are or have been self-employed or a business owner at any time in your career, or if you took time out for a sustained period, such as to raise children.

If you’re unsure how many qualifying years you have, you can check your record on the UK government database.

There, you can find:

• How much State Pension you’re on track to receive
• Your State Pension Age
• If you have any missing years of NICs.

If you’re missing qualifying years, you may be able to pay voluntary NICs to make up the shortfall and increase the amount you’ll receive when you reach State Pension Age.

Your record will also show how much voluntary contributions might cost you, and how much your State Pension would then increase. This can help you to decide if it’s worth paying them.

You can usually back-date voluntary contributions for the past six tax years. However, the deadline for paying voluntary NICs from April 2006 up to April 2017 has been extended by HMRC to 5 April 2025.

You may also be able to claim additional NICs credits to fill your record, such as grandparents’ childcare credits if you have helped look after your grandchildren.

2. Consider deferring your State Pension

When you reach State Pension Age, you aren’t obliged to start receiving it, and if you choose to defer, you’ll be paid a higher amount when you do decide to claim it.

If you don’t actively claim your State Pension, it will automatically be deferred.

Moreover, if you’ve already started receiving it, you can opt to pause your State Pension payments for a time (perhaps if you are going back into work) and benefit from the additional deferral payments, but you can only do this once.

For every nine weeks you defer, you’ll benefit from an extra 1% later, around £2.20 a week in 2024/25. If you defer for a full year, you gain an extra 5.8%, around £12.83 a week.

Due to the fact that deferring means you’ll receive your State Pension for a shorter time, whether it adds up and is beneficial for you will depend on how long you are likely to live and your income.

For instance, deferring the State Pension for a year currently increases payments by £667 annually. However, to achieve this, you forgo £11,502 in that first year, meaning it would take about 20 years of receiving the increased pension to break even.

If you’re in poor health or have concerns about life expectancy, deferring may not be advantageous since you’re less likely to reach the breakeven point. Conversely, if you’re in good health and have a longer life expectancy, you could benefit from higher payments in the future.

Your decision should also account for your current and future income. If you’re still earning or are drawing a substantial income from your private pensions and other savings, deferring might help reduce your Income Tax liability. Waiting until you fall into a lower tax bracket to start claiming the State Pension could allow you to retain more of your retirement income.

Ultimately, deferring your State Pension can help to maximise your payments over the years, but it requires a close look at your health, income, and tax situation.

A financial planner can help you determine the best approach based on your circumstances.

3. Maximise any spousal benefits you are eligible for

There are also spousal benefits you may be eligible for that could help to boose either your or your partner’s State Pension, provided you are in a marriage or civil partnership.

For example, if you receive Child Benefit and your child is under 12, you’ll receive National Insurance (NI) credits to help boost your qualifying years. But if you’re still in work and making NICs, you may be accruing more credits than you need.

So, if your partner is not paying NICs, you can transfer your credits to them at the end of each tax year.

Additionally, you may be able to inherit some of your partner’s State Pension when they die, depending on when they reached the State Pension Age, their NI record, and their deferral history.

Get in touch

A financial planner can help ensure your State Pension is maximised and set up to support your retirement.

To speak to a financial planner, get in touch.

Email info@blueskyifas.co.uk or call us on 01189 876655.

Please note

This blog is for general information only and does not constitute advice. The information is aimed at retail clients only.

This article is for information only. Please do not act based on anything you might read in this article. All contents are based on our understanding of HMRC legislation, which is subject to change.