If you have worked most of your life, you probably can't wait to leave all that stress behind and enjoy a well deserved break. When it comes to planning your retirement in the UK, there are different options you could qualify for. In this article, we'll tell you what you need to know to help you plan your retirement.
The State Pension is a retirement benefit scheme offered to UK citizens who have reached state pension age. Would you like to retire early? Well, the state pension age is actually the earliest you can retire and it's affected by your personal circumstances. You can check what age you begin to qualify for State Pension here.
The answer will depend on your personal circumstances. Have you paid enough money into your pension to live comfortably? If the answer is yes, by all means you can apply to retire early. The good news is that there is no forced retirement age for UK citizens, so you can choose to continue working past your state pension age if that's what you need or desire. Here are the options to defer your payments.
When it comes to pensions, there are three possible options available: the Basic State Pension, the New State Pension, and the Additional State Pension. Let's see what they are and how to apply.
You qualify for the Basic State pension if:
As long as you have contributed to your National Insurance you could claim up to £141.85 per week.
To begin receiving the Basic State Pension, you must submit a claim for it. You can do this in one of the following three ways.
You are eligible to claim new state pension if you are:
Additionally, you will need to have at least ten qualifying years on your National Insurance record.
The whole state pension amount is £185.15 per week and how much you get is dependent on your National Insurance contributions.
Two months before you reach state pension age, you will receive a letter with instructions on how to claim your benefits. You won't get payments automatically, so it’s essential to submit a claim. The fastest way to do this is online; however, you can also request an application form by phoning the Pension Service on 0800 731 7898.
Additional State Pension is money you can claim if you receive the Basic State Pension. To qualify, you must be:
There is no fixed amount, so how much you receive as part of your additional State Pension benefits depends on several factors, such as how many years you spent contributing to National Insurance; your earnings; if you’ve contracted out of the program; and whether you’ve topped up your basic State Pension.
If you qualify, you will begin to receive additional State Pension benefits automatically unless you opt-out.
There are some simple but effective steps you can take to begin planning your retirement now that will set you up for success later. Once you have decided what age you want to retire, you should check how much you can get. Many factors play into how much you will receive, as the final sum is affected by the taxes you'll pay in your pension, and whether you are contributing to a workplace pension or a personal pension fund. You can use this online tool to check how much you can expect to receive.
You may also want to look into ways of increasing your pension. For example, you might be able to get more pension funds by delaying your State Pension. If this won't help your particular situation, try to seek counsel from a financial advisor. You may be able to access financial assistance if you are on a low income, need help paying your rent or your heating bills, have a disability, or need travel assistance. For more information, you should check the gov.uk official website.