Martin Lewis has explained the rules around the state pension (Image: ITV)
Martin Lewis has explained some important rules to know when it comes your state pension. He shared some thoughts about National Insurance contributions as well as how you can get some extra DWP payments.
A question came in on his BBC podcast from someone who had a family member who was soon to turn 40. Yet they were in the unusual position of having no National Insurance (NI) contributions, as they had never worked or claimed any benefit to provide NI credits.
The person asked that should their relative continue in this way in having zero contributions, what would they be entitled to under the current DWP rules. In response, Mr Lewis said there is a “hard bottom and a soft top” regarding how your state pension entitlement works.
He explained: “For those who don’t know, National Insurance contributions are when you work or if you get certain benefits if you look after children, you get a National Insurance credit.
“I think of it like a token – for each year that you work, you get a National Insurance credit – a token that goes into the piggy bank.”
You don’t stop paying
The consumer expert went on to explain the rough rule of thumb here: “I generally say you need 35 years worth-ish of National Insurance to get the full state pension. But it really is in ‘ish-‘. For some people it’s more, for some people it’s less.
“Just because you’ve got your full state pension entitlement, doesn’t mean you stop paying National Insurance if you’re working, and you’re under state pension age.”
This is the ‘soft top’ Mr Lewis was referring to, as how much National Insurance contributions you need to qualify for the full state pension depends on your situation. The full new state pension currently pays £241.30 a week, or around £12,550 a year.
Under current rules, a person typically needs 35 years of NI contributions to get the full new state pension, or 30 years’ worth to get the full basic state pension.
If you want to check how much state pension you are on track to receive, you can use a tool on the Government website to do this.
‘Hard bottom’ explained
But things are much more clear cut when it comes to the point where you qualify for any state pension payments at all. Mr Lewis warned: “The bottom is a hard bottom, because to get any state pension, you need 10 years of National Insurance credits.”
You do have the option to pay to fill in any gaps in your National Insurance record, up to six tax years ago. This may be worth thinking about if you are missing contributions but are very near to the 10-year threshold to qualify for a payment.
Mr Lewis shared one success story here, of someone who had nine years’ worth paid in, and so buying just one year was “hugely valuable” for them. Buying the additional year took them from zero entitlement for the state pension to qualifying for around a third of the full amount.
This meant that within three months of them starting to receive their state pension, they would have got back the money they paid to fill in the one-year gap.
If you reached the minimum 10 qualifying years, you could get £68.90 a week under the current full new state pension rates, adding £3,582.80 a year to your income, or almost £300 a month.
‘Less than £240’ qualifying rule
However, if you reach state pension age and have very low income and no state pension entitlement, you can still get DWP support. Mr Lewis said: “The obvious thing for someone with no or low income is Pension Credit.
“Pension Credit is effectively a top up to any or no state pension that you get, to give you a minimum income. So for people who have less than about £240 of income a week, including state pension and private pension and any income from savings and investments, then they can get the Pension Credit top up.”
Pension Credit is open to people of state pension age, which is currently moving up in stages from 66 to 67, between April 2026 and April 2028. The benefit tops up your income to £238 a week if you are single and up to £363.25 if you have a partner, so if your relevant income is less than these amounts, you may qualify.
However, you can get extra amounts on top of this income top-up depending on your situation, effectively increasing by these amounts how much income you can have and still qualify for the benefit. For example, you can get an extra £86.05 a week if you have a severe disability or an extra £48.15 weekly if you care for another adult.
Plus you can get a raft of other support as a Pension Credit claimant. Mr Lewis said: “Pension Credit interestingly is actually a gateway benefit that opens up access to a whole other load of benefits.”
If you are on the benefit, you can get help such a council tax discounts and extra cash towards your housing costs, as well as help with NHS costs and a free TV licence for claimants aged 75 and over.