Ignoring an impending deadline might cost people hundreds of pounds annually in retirement and, with barely two weeks left until this crucial date, experts are sounding the alarm.
Russell Gous, chief editor at TopMoneyCompare, has specifically highlighted the predicament facing expats: “Expats are particularly at risk of missing out on a full pension, as many spend long periods working abroad and may not have made enough qualifying contributions in the UK. For those living overseas, checking your NI record is essential.
“Many expats assume they’ll qualify for the full state pension, only to realise too late that gaps in their record mean they receive much less than expected.
“Paying voluntary NI contributions can be one of the best returns on investment, as even a small top-up could significantly boost pension payments over time.”
People currently have until April 5 to retroactively update their National Insurance records all the way back to 2006, which is crucial for their state pension benefits.
However, those residing abroad are confronted with additional obstacles, as the expert noted: “The decision isn’t always straightforward, especially for those relying on their UK pension in a foreign currency.
“Exchange rate fluctuations can reduce the value of payments, so expats should factor in how far their pension will stretch in their country of residence.”
They also warned of the urgency required, advising: “With time running out, expats should act now to avoid losing out. The worst-case scenario is waiting until it’s too late and being locked out of the chance to boost your pension for life.”
To receive the full new state pension, individuals need a minimum of 35 qualifying years of National Insurance contributions.
For those with gaps in their National Insurance record, voluntary contributions can plug this if they have fewer than 35 qualifying years. Currently, it costs £17.45 to purchase a week’s worth of National Insurance credits or £907.40 for an entire year.
Investing in voluntary contributions can increase your state pension by £328.64 annually.
Over time, this can significantly add up; for example, buying a full year and living 20 years beyond state pension age could result in an additional £6,500 in state pension for an outlay of £907.40.
For those with gaps in their National Insurance record, voluntary contributions can plug this if they have fewer than 35 qualifying years. Currently, it costs £17.45 to purchase a week’s worth of National Insurance credits or £907.40 for an entire year.
Investing in voluntary contributions can increase your state pension by £328.64 annually.
Over time, this can significantly add up; for example, buying a full year and living 20 years beyond state pension age could result in an additional £6,500 in state pension for an outlay of £907.40.
However, there’s a looming deadline for addressing gaps in National Insurance records between 2006 and 2019, which is April 5. After this date, individuals can only fill gaps going back six years.
For example, if you worked and paid National Insurance from 1990-2006 but then took a career break and only started working again in 2015, you’ll only have around 26 qualifying years in 2025.
You won’t be able to fill the 2006-2015 gap after April 5 and will need to pay national insurance for another nine years to get the full state pension.
However, if you hit the state pension age before the nine years are up you’ll need to find another way to plug the gap as you won’t be paying National Insurance through your work in most cases.
