What is the state pension?

The state pension is a regular payment from the government that most people can claim when they reach retirement age. The amount you’ll receive will depend on how many years you’ve worked, your birth date, and your age at retirement.

For most people, the state pension alone won’t be enough to live on comfortably. That’s why people typically supplement these payments with a workplace pension or a personal pension scheme.

In this article, get up to speed on how much your state pension is worth, how you can claim it, and some other things you can do to make sure you’re financially ready for retirement.

What is the state pension?

There are actually two state pension schemes in the UK. Your date of birth determines which one you’ll receive.

  • The ‘new’ state pensionYou’ll receive the ‘new’ State Pension if you’ve worked for at least 10 years in the UK and :
    • you’re a man born on or after 6 April 1951, or
    • a woman born on or after 6 April 1953.

As of 2022/2023, the new state pension gives you up to £185.15 per week, or a total of £9,627.80 a year. The sum changes every year based on inflation. GOV.UK is the most reliable source for the latest figures.

  • The ‘old’ state pension If you were born before these dates, you’ll get the ‘old’ State Pension. You’ll likely be claiming your State Pension already. Rather than a single sum, the ‘old’ state pension is broken into two parts: 1.  The basic state pension 2.  The additional state pension

How much you receive will depend on your earnings and whether you've claimed any benefits in the past.

You can claim your State Pension at what’s known as the state pension age. This is currently 66 for both men and women, but it’s expected to increase soon. You can check out GOV.UK for up-to-date information.

By the way, don’t confuse your State Pension age with your retirement age. The state pension age is fixed by law, but you can decide your retirement age. It can be a lot earlier or a lot later depending on your preferences and financial situation.

Am I entitled to a state pension?

You’ll only receive a state pension if you’ve worked and paid taxes in the UK for enough years.

How much state pension you’ll receive is based on your National Insurance record. You’ll need at least 10 years of contributions on your NI record to qualify for a state pension. To receive the full state pension of £185.15 a week, you need at least 35 years of NI contributions.

You’ll pay NI contributions for every year you work in the UK as long as you earn the minimum amount needed to qualify. In 2022/23, the minimum is £6,396, but it tends to increase every year.

There are other ways to build up years on your NI record. For example, you’ll still get NI credits in a particular year if:

  • You’re on Jobseeker’s Allowance or Employment and Support Allowance
  • You’re a carer
  • You’re receiving Child Benefits

It’s worth noting that your NI record is individual to you. There used to be special pension arrangements for married couples, but this is no longer the case. You and your partner will have separate NI records, and they will both need to be full if you want to claim a full state pension.

That said, if you’re widowed, you can claim part of your partner’s pension. This will be paid at the same time as your own state pension.

What happens if you don’t have enough NI contributions?

Sometimes, people reach the state pension age without enough qualifying years on their NI record. That could be because you lived abroad for a few years, you were unemployed, or you didn’t earn the minimum amount to make NI contributions.

If this applies to you, you have a couple of options:

  • You can receive less in your state pension. If you have any gaps in your NI record, you’ll only receive a State Pension proportional to how many qualifying years you have.

For example, say you have 30 qualifying years. You can find out how much you’re entitled to by dividing the full state pension amount by 35 and then multiplying it by 30. In this case, you’d receive £158.70 a week.

  • You can pay voluntary National Insurance contributions. You can pay to add qualifying years to your NI record so that you can receive the full state pension. There is a time limit on when these can be paid. You can usually pay voluntary contributions to make up for any years you missed during the previous six-year period.

Once you reach the state pension age, you’ll no longer pay NI contributions. That means that you won’t be able to keep working to add to your NI record. However, you can still pay voluntary contributions for previous years.

How do you claim the state pension?

You don’t receive your state pension automatically. You have to claim it. You’ll typically get a letter about four months before you reach State Pension age telling you how to claim your pension.

You can claim online, by post, or over the phone. All you’ll need is details of the bank account you want your state pension to be paid into and the code you’ll see on the letter inviting you to claim.

After that, you’ll receive your pension as soon as you reach the state pension age. It’s paid into your account every four weeks.

So you don’t get any nasty surprises, it’s worth knowing that your state pension is taxable. That means that if you have any other income—like another personal pension or income from a second home—you’ll have to pay tax on everything over your personal allowance.

You can also defer claiming your State Pension if you want to, for example, if you’re still working. You don’t have to do anything if you want to defer your pension. Just wait to claim it when you’re ready.

Is the state pension enough to live on?

Typically, the state pension alone won’t be enough for you to live on. While it will often cover basic costs, most people will have another pension or income to supplement what they receive from the government.

To give you an idea of how much you’ll need for your pension, the Pensions and Lifetime Savings Association calculated three benchmarks for how much people would spend per year to support typical lifestyles after retirement:

  • Minimum/basic £12,800 a year, or £19,900 between a couple. This would cover basic needs, plus treats like a week’s UK holiday each year.

If you’re in a couple and both of you have a full state pension, you’d be able to afford this lifestyle. People living alone, though, will need another source of income like a workplace pension.

  • Moderate £23,300 a year, or £34,000 between a couple. The PLSA estimates that over half of the people could afford a minimum or moderate lifestyle, but this would require an additional retirement pot on top of your State Pension.
  • Comfortable £37,000 a year, or £54,500 between a couple. According to the PLSA, one in six people is likely to be able to afford a “comfortable” retirement, with three weeks of holidays in Europe each year and two cars. However, your State Pension alone won’t get you there.

To work out how much you’re likely to need in retirement based on your current lifestyle, use the “two-thirds” rule. If you currently earn £30,000, you’ll need at least £20,000 a year after retirement to enjoy what you do now.

The "two thirds" rule

How can I boost my retirement income?

Whether you’re currently saving for retirement or you’re approaching state pension age, there are some things you can do to improve the health of your finances.

1. Keep working

When you want to retire is a really personal question. Some people are determined to retire as early as possible, while others enjoy working for as long as they can.

Whichever category you fall into, it’s worth knowing that by deferring your State Pension, you can increase the retirement income you’ll receive later on.

Your State Pension increases by 1% for every 9 weeks that you defer it. That adds up to an increase of just under 5.8% if you defer it for a year. Say you’re entitled to a full State Pension of £185.15. If you defer it for a year, you’ll get an extra £10.70 a week.

2. Save into a personal pension

Most people will save into a retirement fund alongside their State Pension. This could be a workplace pension or a self-invested personal pension (SIPP), i.e. a pension scheme that you arrange yourself.

If you’re an employee, you’ll be automatically enrolled into a workplace pension scheme. This will be worth a minimum of 8% of your income, where you pay 4% of your salary, your employer pays 3%, and the government gives you an extra 1% in tax relief.

However, if you’re self-employed—or you want to save a little extra for retirement on top of your workplace scheme—it can be a good idea to save into a SIPP.

For example, with CIRCA5000, you can save as much or as little as you’d like up to the annual and lifetime allowances. Just like your workplace pension, your savings will be invested into stocks and shares, but you’ll have greater control over where you invest. What’s more, you’ll receive 20% in tax relief from the government on any money you pay into your pension that qualifies as pensionable earnings.

It can often make sense to start saving early. The earlier you start saving, the more you’re likely to have in your pension pot come retirement.

3. Combine your old workplace pensions

The average person has 11 jobs in their lifetime. That means you could have 11 different pensions—you might just have forgotten about them.

If you’re unsure whether you have pensions from previous employers, you can use our trace and transfer service to track them down. Our tracing team can help you dig them up and find out how much they’re worth for free and with no strings attached.

Once you’ve found them, it may make sense to unite all of your old pensions into a single fund. This can give you a clearer sense of how much your retirement savings are worth, what fees you might be paying, and where your money is invested.

Recap: What is the state pension?

The state pension is a regular payment from the government that you can claim once you turn 66 (or 67 after 2026). How much it will be will depend on your National Insurance contributions, but the maximum you can expect for a full state pension is currently £185.15.

Typically, a state pension won’t be enough to cover most people's expenses after retirement. That’s why it can often be worth saving into a workplace or personal pension. It’s easy. You can set one up today.


When you invest, your capital is at risk. You should carefully consider whether opening a CIRCA5000 pension or transferring your old pensions is right for you. Please note that tax rules and reliefs depend on your personal circumstances and may change. CIRCA5000 does not provide any financial or tax advice, and you are responsible for your own tax reliefs/payments. This article does not represent financial advice. Your investments and the income from them can go down as well as up. It is sensible to seek independent financial advice if your pension is worth £30,000 or more.

Important information - Investments can go down in value as well as up, so you can get back less than you invest. The information on this page isn't investment advice. If you're not sure if an investment is right for you, please seek advice. Tax rules can change and depend on individual circumstances.