Time is running out for anyone who wants to boost their State Pension by paying for any missing National Insurance years, Martin Lewis has warned.
People aged between 40 and 73 have until just April 5 this year to plug any gaps in their NI payments by buying missing years going back to 2006.
After the deadline you will only be able to buy back up to 2019 and could miss out on a full State Pension if you have any holes in your NI history due to spells of unemployment, low income, not claiming credits or living and working abroad.
We do not always agree with all advice from Mr Lewis of www.moneysavingexpert.com fame as well as TV’s The Martin Lewis Money Show Live, but we do commend his endeavours to help educate people about money.
This issue in particular is a vital one and very important to highlight as it could make a real difference in retirement for many people, especially if funds are tight to begin with.
Mr Lewis explained on a recent episode of his show that everyone needs at least 10 qualifying NI years to get some State Pension. To get the full rate, you need around 35 qualifying years, but this may be more for some people if they were ‘contracted out’.
This can only help boost payments for those who reached State Pension age after April 2016 who are not in receipt of the full weekly rate of the New State Pension of £221.20, or those under the current State Pension age of 66.
If you are not sure, please check as soon as possible by going to the Government web page at www.gov.uk/check-state-pension. Please bear in mind this is likely to become busy as the deadline approaches, so don’t leave it too late.
Cash ISA has a likely reprieve – for now
Chancellor Rachel Reeves is unlikely to reduce the tax free threshold for Cash ISAs in the March 26 Spring Statement, according to the FT and as reported by Citywire.
There had been debate whether the Chancellor would cut the allowance from £20,000 to £4,000 as part of a move to encourage more stock market investment from savers, following lobbying from City firms who argued it would help boost the economy.
We discussed this in depth in a recent column, but while the general consensus is the cut is unlikely to happen this month, the Government is still understood to be actively considering reforms to the tax-free savings accounts.
Government sources told the FT a big fiscal decision, such as reforming ISAs, would be more likely in the Autumn Budget.
Regular readers will know we are not especially fans of savings accounts that see cash essentially dormant or indeed losing money in real terms as the purchasing power of your Pound becomes less over time due to rising inflation.
People with significant sums to invest would in all likelihood see a better return if at least some was invested in Market ISAs or other financial products such as pensions.
That said, saving is certainly not a bad thing and there is the question of whether a government can or should dictate on how and where you save or invest your money (within legal boundaries, of course!)
The media grapevine has been wrong before of course, but it does seem as if Cash ISAs have enjoyed a reprieve until the Autumn at least…
