What is the new State Pension?
The State Pension is changing for anyone reaching State Pension age on or after April 6, 2016.
The new State Pension will be clearer and easier to understand, replacing the complicated multi-tiered current system of basic and additional State Pension.
Why is it being replaced?
The old pension was complex, made it confusing for people to save, and left many not getting additional payments.
Under the new system, women, carers and self-employed people are likely to benefit from a higher state pension
Under the new system, women, carers and self-employed people who haven’t previously received much by way of an additional pension are likely to benefit from a higher state pension.
In the first 10 years, about 650,000 women are set to benefit from the changes, getting on average £8 a week more in State Pension.
Will everyone receive the full rate of the new State Pension?
No. What you'll receive will still depend on your National Insurance (NI) record – the NI contributions you have made or been credited with. But you can get credits when you are raising a family, caring, or even granny credits if you look after the grandkids.
How can I find out how much I will get?
People who are 55 and over can ask for a State Pension statement. This will give an estimate of their new State Pension based on their current National Insurance record. You can find out more about that here.
What is the full rate of the new State Pension?
The full level of the new State Pension will be more than £150 per week but the exact rate will be set next year before it is introduced.
Will people be better or worse off under the new State Pension?
A lot of people stand to gain from the new State Pension, especially self-employed people and women. In fact, around three-quarters of people reaching State Pension age in 2020 will have a higher State Pension under the new system.
Is it true that not everyone will get the full new State Pension?
What you receive depends on your NI record, so people without a complete National Insurance record may not get the full amount – just as today.
But many people will end up with more under the new system, even if they’re not getting the full rate.
To ensure absolute fairness, for people retiring in the years after April 2016, the State Pension they will get will be the highest out of what they’d be entitled to under the old or new system.
What happens if you don't work while looking after children or have a caring role?
Depending on your circumstances if you are a carer or parent you may get NI credits, which contribute towards your State Pension. You can find out more here.
Can you increase the payments by putting off your State Pension?
Yes, you can increase the amount of State Pension you get by “deferring” your claim. In fact, your State Pension will be automatically deferred until you choose to claim it. You can find out more here.
Is the state pension age changing?
Yes. You can find out when you will reach State Pension age by using the State Pension calculator here.
You can find out more about the changes with this short video here.
- Find out more about the new pension changes coming this April here. Plus 5 pension mistakes to avoid!