State pension National Insurance topping up warning issued

Increasing your state pension by topping up National Insurance contributions could give your retirement finances a lift, but it might not be the best move for everyone. At present, you have the opportunity to fill any gaps in your NI record by voluntarily paying beyond the usual six-year cap, going as far back as the tax year 2006/2007.

This expanded window is open until April 2025, after which it will return to the regular six-year limit. However, Yair Bennett, the founder of BOI Agent, has issued a word of caution to those thinking of topping up.

He said: "If someone has other financial priorities or a shorter retirement horizon, the mathematics may not work out. It's important to consider tax consequences, alternative retirement income sources, and cost of living adjustments.

"If returns surpass the pension payout, it may be prudent to invest that money elsewhere." To qualify for the new full state pension, which currently stands at £221.20 weekly, typically 35 years of complete NI contributions are required and 30 years for receiving the basic amount, which is currently £169.50 weekly.

From next April, under the triple lock, payments will rise by 4.1 percent, taking the full new state pension to £230.30 a week and the full basic to £176.45 a week. When buying voluntary NI contributions, the rate is £3.45 weekly (£179.40 annually) for Class 2 contributions and £17.45 weekly (£907.40 annually) for Class 3.

This applies to men born after April 5, 1951, or women born after April 5, 1953. To check for any gaps, you can view your NI record on the Government website, which also offers a forecast tool to estimate potential state pension and ways to increase it.

Mr Bennett highlighted the financial benefits of closing