DWP £824 Financial BOOST for State Pensioners born before 1959: If you’re nearing retirement, there’s an opportunity to boost your state pension for free—and potentially save £824 or more—ahead of a key deadline this April. While many people are being encouraged to buy voluntary National Insurance (NI) contributions to fill gaps in their record, experts are urging caution: you might be entitled to free NI credits or benefit from deferring your pension instead.
Here’s what you need to know to make the most of your state pension entitlement.
Check Before You Pay: You May Be Entitled to Free NI Credits
The Department for Work and Pensions (DWP) is giving people the option to buy missing NI years all the way back to 2006—but that comes at a cost of roughly £824 per year. Buying a year boosts your pension by about £5.28 per week, or £275 annually. Over time, this adds up—but there may be a free alternative.
If you have gaps in your National Insurance record, don’t assume you need to pay to fill them. You might qualify for National Insurance credits, particularly if you were:
- Caring for children or elderly relatives
- Claiming certain benefits
- Receiving Universal Credit or Carer’s Allowance
- On maternity, paternity, or sick leave
These NI credits can be backdated to 2011, according to Baroness Ros Altmann, so it’s well worth checking if you’re eligible before handing over any money.
Deadline Alert: April 2025 Cut-Off to Backdate to 2006
A limited-time opportunity allows individuals to backfill NI contributions as far back as 2006, but this window closes in April 2025. After the deadline, you’ll only be able to buy missing years going back six years, making this a now-or-never chance to significantly boost your pension.
🔎 Action Step: Use your personal account on the Gov.uk website to check your NI record and see if you have any shortfalls.
Deferring Your Pension: Another Free Boost
If you’re eligible for the state pension but don’t need the income immediately, deferring your claim can increase your payments over time. Here’s how it works:
- For every 9 weeks you defer, your pension goes up by 1%
- That’s roughly a 5.8% annual increase
- Deferring for one year could add £614+ to your yearly pension income
But there’s a caveat: deferring may affect your tax liability or eligibility for other benefits like Pension Credit. Helen Morrissey from Hargreaves Lansdown warns that before deferring, you should review how the increase impacts your overall income and benefits status.
Who Should Consider Buying Voluntary Contributions?
Paying for missing years might still be worthwhile if you’re not eligible for free credits and don’t yet have the 35 qualifying years required for the full new state pension (currently worth £203.85 per week).
Use the table below as a guide:
| Scenario | Best Move |
|---|---|
| Gaps in NI record and eligible for credits | Claim credits (free) |
| Gaps in NI record but not eligible for credits | Consider buying NI years before April |
| Already at 35+ qualifying years | No action needed |
| Reaching pension age but don’t need income yet | Consider deferring |
| On low income or receiving other benefits | Check impact on Pension Credit or taxes |
How to Check and Act
- Check Your NI Record: Visit gov.uk to view your contribution history.
- Check for Credits: If you had gaps due to caregiving or other reasons, contact HMRC to see if you’re eligible for backdated NI credits.
- Use the Pension Forecast Tool: See how much state pension you’re on track to receive.
- Act Before April Deadline: If you’re considering buying contributions, do so before the April 2025 cut-off to maximize the backdating benefit.
Taking time now to review your National Insurance record, explore free credit options, or consider deferring your pension could add hundreds—if not thousands—of pounds to your future retirement income.
FAQ
How can I boost my state pension for free?
You may be eligible for free National Insurance credits if you had gaps in your record due to caregiving, unemployment, or receiving certain benefits. These credits can often be backdated to 2011.
What is the deadline to buy back missing National Insurance years?
The deadline to buy back voluntary National Insurance contributions going back to 2006 is April 2025.
How much does it cost to buy a missing year of NI contributions?
It costs around £824 to buy a missing year, which can increase your state pension by about £275 per year.
Can I increase my pension by deferring it?
Yes, deferring your pension increases it by around 5.8% per year. However, you should check how this may affect your taxes or benefits eligibility.
How many qualifying years do I need for a full state pension?
You need 35 qualifying years of National Insurance contributions or credits to receive the full new state pension.
