Getting the most out of your state pension is something every UK retiree wants to achieve. In 2025, there are simple actions you can take that could increase your pension by up to £700. Many people are unaware of these steps, but with a little planning, it’s possible to significantly improve your retirement income.
Understanding the State Pension
The UK state pension is a regular payment from the government once you reach state pension age. Its value depends on your National Insurance contributions over your working life. The full new state pension is currently around £203.85 per week (as of 2025), but many people do not receive the maximum due to gaps in contributions.
Why Some People Get Less
Not everyone qualifies for the full state pension. Some common reasons include:
- Missing National Insurance contributions due to unemployment or self-employment gaps
- Part-time work with low contributions
- Time spent living abroad without paying voluntary contributions
- Childcare or caregiving periods not properly accounted for
Understanding these reasons is the first step toward boosting your pension.
Check Your National Insurance Record
One of the easiest ways to potentially increase your state pension is by reviewing your National Insurance (NI) record. The government allows you to check your contributions online via the HMRC website.
Look out for missing years or gaps in your record. If you spot any, you may be able to make voluntary contributions to fill these gaps and increase your pension. Each missing year could be worth hundreds of pounds per year in retirement income.
Make Voluntary Contributions
If you are eligible, making voluntary National Insurance contributions can have a direct impact on your pension. For the 2025 tax year, contributing to missing years can increase your state pension by up to £700.
These contributions are particularly useful for people who:
- Were self-employed and didn’t pay enough NI
- Lived or worked abroad
- Had periods of low earnings
It’s important to calculate whether the voluntary contribution cost is worth the potential increase in pension. Usually, the return on investment is high, making it a smart move for most retirees.
Consider Deferring Your State Pension
Deferring your state pension is another way to boost your income. If you delay claiming your pension past state pension age, your weekly payments will increase by a certain percentage for each year you wait.
For example:
- Deferring for 1 year could increase your pension by roughly 5.8%
- Deferring for 2 years increases it by around 11.6%
This method is ideal for those who don’t need the pension immediately and want a larger income later.
Use Pension Forecast Tools
The UK government provides online tools to forecast your state pension. Using these tools helps you understand how much you are entitled to and the potential increase if you take specific steps, such as making voluntary contributions or deferring your pension.
Forecasting your pension also helps in planning retirement more accurately, ensuring you can make informed decisions about when and how to claim your benefits.
Maximise Your Pension With Additional Savings
While boosting your state pension is important, combining it with private savings can make a significant difference. Consider these options:
- Personal Pensions: Regular contributions to a personal pension plan can complement your state pension.
- Workplace Pensions: Continue contributing to any existing workplace pension schemes if possible.
- ISA Investments: Tax-free savings accounts can provide additional income for retirement.
Claim Any Additional Benefits
Some retirees may be eligible for additional government benefits. These can include:
- Pension Credit
- Housing Benefit
- Council Tax Support
Checking your eligibility ensures you receive all the financial support you are entitled to. Pension Credit, in particular, can top up your income if your total pension is below a certain threshold.
Plan Early for Maximum Benefit
The key to boosting your state pension is planning. The earlier you review your National Insurance record and make any necessary contributions, the more you can increase your pension. Even a few years of voluntary contributions can make a noticeable difference in your retirement income.
Understanding the Impact of Inflation
While £700 may not seem like a large amount, it can make a difference in your retirement budget, especially considering rising living costs. Planning ahead ensures that you maintain a comfortable standard of living in your later years.
Seek Professional Advice
For complex cases, consulting a financial adviser who specialises in pensions can be invaluable. They can help you:
- Identify gaps in your NI contributions
- Decide whether voluntary contributions are worthwhile
- Plan the optimal time to claim your pension
- Explore additional savings options
Final Thoughts
Boosting your state pension doesn’t have to be complicated. By checking your National Insurance record, making voluntary contributions, deferring your pension, and claiming eligible benefits, you could increase your retirement income by up to £700 in 2025.
Taking action now ensures you get the most out of your state pension and enjoy a more financially secure retirement. Every small step counts, and planning early can pay off significantly in the long run.