I'm 51 - is it too late for me to pay towards a state pension?

27 April 2020

Q

I would like some advice about my state pension. I am 51 years old and have been self-employed on a very low income all my life. As a result, I have never paid any national insurance contributions (NICs). I would like some advice about my state pension. I am 51 years old and have been self-employed on a very low income all my life. As a result, I have never paid any national insurance contributions (NICs).

From
LFC/via email

A

Somebody who is self-employed will typically build up their entitlement to the state pension through their national insurance (NI) record or through national insurance credits if they were raising a family, caring for somebody or in full-time training.

Some people will have gaps in their national insurance record, and one of these reasons, as you have stated, could be because they were self-employed and had a low income.

Before you do anything else you should get a state pension statement, which will confirm your position and give a projection of any entitlement to the state pension that you have built up. Even with low earnings you may have some national insurance credits if, for example, you claimed child benefit for a child aged under 12.

You can get a state pension statement from Gov.uk/check-state-pension or by calling the Future Pension Centre on 0800 731 0175.

Assuming that your national insurance record is incomplete, and because you are self-employed, you should be able to make Voluntary Class 2 contributions. You can usually pay voluntary contributions for the past six years. However, HMRC has extended the time limits for paying voluntary NICs for the 2006/07 to 2015/16 tax years inclusive. The deadline for this period is now 5 April 2023. The cost depends on the years you want to pay for.

Whether this is a good idea for you may depend on how much you can afford now and how long you are likely to live. Also, you need a minimum of 10 years’ contributions to get any state pension at all, so if you have less than this you will not receive anything. 

Patrick Connolly is a certified financial planner at Chase de Vere.

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