150,000 pensioners missing out on £5,000 retirement boost – here’s how to claim

MORE than 150,000 pensioners could be missing out on a retirement boost of up to £5,000.

Thousands of carers are unaware that they could be benefiting from National Insurance credits that could top up their retirement pot.

The state pension is currently worth up to £175.60 per week and how much you'll get depends on when you retire, as well as how much you pay in National Insurance contributions throughout your working life.

You will need at least 10 qualifying years on your National Insurance record to receive the state pension – although they don't have to be 10 years in a row.

For most people this means working and paying National Insurance for at least a decade.

However, if you are a carer you might be unable to work, leaving you with gaps in your National Insurance record.

You could be eligible for carers credits that will fill these in, allowing you to boost your overall pension pot and ensuring you don't miss out on money you're entitled to.

Carers credits can be used to make sure you get at least the minimum state pension.

Or if you already qualify, increase the amount you get – you currently need 35 qualifying years of National Insurance to get the maximum amount.

This means you can take on caring responsibilities without affecting your ability to qualify for the state pension.

But, according to research by wealth management firm Quilter, just 5,209 people claimed Carer's Credit in 2020.

Each annual credit missed could cost 1/35 of the value of the state pension – around £260 per year or £5,200 over the course of a typical 20-year retirement.

Top tips to boost your pension pot

DON’T know where to start? Here are some tips from financial provider Aviva on how to get going.

• Understand where you start: Before you consider your plans for tomorrow, you'll need to understand where you stand today. Look into your current pension savings and research when you’ll be eligible for the state pension, and how much support you’ll receive.
• Take advantage of your workplace pension: All employers are legally required to provide a workplace pension. If you save, your employer will usually have to contribute too.
• Take advantage of online planning tools: Financial providers Aviva and Royal London have tools that give you an idea of what your retirement income will be based on how much you're saving.
• Find out if your workplace offers advice: Many employers offer sessions with financial advisers to help you plan for your future retirement.

Claims have fallen from 6,489 in 2019, despite the jump in the number of people who took on unpaid caring responsibilities during the pandemic.

The number of carers in the UK has surged from 4.5million pre-pandemic to 13.6million.

Only 20% of the approximate overall eligible population have claimed the credit to date -just 40,673 carers.

Who is eligible?

In 2015 the Department for Work & Pensions estimated around 200,000 carers are eligible to claim the credit, with women making up a substantial proportion.

It is expected that this number has dramatically increased since 2015. 

To get Carer’s Credit you must be aged 16 or over but under the state pension age while you are a carer.

You must be looking after at least one person for a minimum of 20 hours a week.

The person you are caring for must usually claim one of the following:

• Disability Living Allowance care component at the middle or highest rate
• Attendance Allowance
• Constant Attendance Allowance
• Personal Independence Payment – daily living component, at the standard or enhanced rate
• Armed Forces Independence Payment

But it is still possible to get Carer's Credit by filling in the 'Care Certificate' part of your application and getting it signed by a health or social care professional.

Even if you don't qualify for Carer's Allowance, you might still qualify for Carer's Credit – and you can double check your eligibility online.

You can still claim the credit if you have breaks from caring – up to 12 weeks in a row.

If you are a foster carer you should apply for National Insurance Credits instead.

You can claim other National Insurance credits if there is a break in your employment history that is not related to being a carer.

For example, credits are available for people claiming certain benefits such as Universal Credit, Working Tax Credit or if you are off work due to illness, disability or maternity or paternity leave.

How to apply

You can download an application form from the goverment's website, which you should fill out and return using the address provided.

However, you do not need to apply if you get Carer's Allowance or Child Benefit for a child under 12 as you will automatically get credits.

You can challenge a decision about your claim online – this is called asking for mandatory reconsideration.

Saving just £100 a month in your twenties can build up a pension pot worth £321,800 towards your retirement.

Single pensioners will need a pension pot of £123,000 just for basics when they retire – and as much as £305,000 to be able to take holidays, new research revealed.

To find out when you'll be eligible to receive the state pension, check out our guide to the rules.

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