MARTIN Lewis has issued an urgent warning over a hack to get FREE money into your bank account.
The Money Saving Expert says time is running out if you want an easy windfall of £5,400.
Martin is telling anyone under the age of 73 to check if they can boost their state pension.
He explained: “Important. Are you under age 73? You may be able to pay £800, or far less, to gain £5,400 or more, but the clock’s ticking!
“It’s all about extra National Insurance (NI) years. And finally, many can now do it online.”
He explains it is all about the ‘new’ state pension introduced in 2016, which applies to all men born after April 5, 1951 and women after April 5,1953.
It takes 35 “qualifying” years of NI contributions to get the full new state pension and at least 10 years to get anything at all.
Currently, you can backfill holes from 2006 to 2016.
Many people are missing past NI years, commonly due to years abroad, low incomes, career breaks or not claiming credits.
Now Brits have until the end of this tax year – April 5, 2025 – to sort it out.
If you don’t fill in the gaps you could end up missing out on the full state pension when you retire, which at the moment is worth £203.85 a week or £10,608 a year.
After April 5, 2025, though you’ll only be able to backdate payments by up to six years.
Although, this scheme only applies to people who reached – or will reach – state pension age after April 5, 2016.
HMRC has said that the revised deadline will enable “tens of thousands” more people to plug the gaps which can boost their pensions by thousands in retirement.
You can check how many years of NI payments you’ve made and see any missing years on the government website.
How to top up National Insurance contributions and how much you can get
In some cases, buying back missing years can be really valuable.
But, it isn’t free so your voluntary contributions do come at a price and you should always check if it’s right for you.
If you’re filling gaps between 2006/07 to 2015/16 you’ll pay the 2022/23 rates for contributions.
It works out to be worth £15.85 a week which means it costs £824.20 to buy one year of contributions.
As the state pension was £185.15 per week in 2022/23, this boost would add £5.29 per week or around £275 per year.
Although you’d have to pay £8,242 (10 lots of £824.20), the annual state pension boost would be around £2,750.
Someone who was retired for 20 years would get back around £55,000 in total (before tax).
Anyone who tops-up their record after April 2025 will pay those rates.
What is National Insurance?
NATIONAL Insurance is a tax on your earnings, or profits if you’re self-employed.
These contributions make you eligible for things like the state pension and certain benefits.
You’ll usually pay National Insurance Contributions (NICs) when you’re over the age of 16 and earning a certain amount.
For example, if you earn £1,000 a week, you pay nothing on the first £242.
Earn over that and you pay 10% on the next £725 – so £72.50. Then you pay 2%o on the rest, so £33, which works out as 66p.
For the self-employed rates are slightly different.
You can also get something known as National Insurance in some circumstances when you’re not working, for example when you have kids and claim certain benefits.
NICs are usually taken automatically by your employer and paid to HMRC, so you don’t need to do anything.
You can see how much NICs you pay on your wage slip.
Anyone working for themselves usually has to pay NICs themselves when completing a self-assessment tax return.
Though before making voluntary contributions, you need to get a pension forecast and speak to the Government’s Future Pension Centre.
This is because there are some situations in which paying historic contributions wouldn’t boost your state pension.
You can check the full list of who’s eligible for claiming credits on the government website.
It explains the circumstances where you’ll need to claim and when you’ll get it automatically.
Here’s the full list of reasons you might have gaps in your record and risk missing out on the full payment.Plus, here are four of the best ways to boost your retirement pot and two to avoid.
Robert Johnson is a UK-based business writer specializing in finance and entrepreneurship. With an eye for market trends and a keen interest in the corporate world, he offers readers valuable insights into business developments.
