Showcasing the Best of Welsh Business

Firm Offers to Guide People Through the State Pensions ‘Minefield’

SHARE
,

A Mid Wales and Shropshire firm of Independent Financial Advisers and insurance brokers is offering to help guide people through the State Pension ‘minefield’ as they plan for retirement.

Chris Tombleson

Chris Tombleson, an Independent Financial Adviser with Rees Astley, which has offices in Newtown, Aberystwyth and Shrewsbury, says it’s important that people check how much State Pension they will receive when they retire

“The State Pension is the foundation of most people’s retirement plans, and yet data shows that more than half of those eligible to claim it under the new flat-rate system receive less than the full amount,” he revealed.

“Remember that it’s only really there to provide a basic standard of living when you retire. Of all life events to plan for, you should devote most time to preparing for retirement.

“If you are in your 50s or early 60s, you may increasingly be thinking more about retirement and how to plan for it. One of the most common dilemmas is how best to fund your lifestyle once you have stopped work to maintain your pre-retirement standard of living.”

He says the new State Pension is an important form of income for many during retirement. Men born on or after April 6, 1951 and women born on or after April 6, 1953 can claim it if they have at least 10 years’ National Insurance contributions

Currently, the earliest the basic State Pension can be claimed is at the age of 66, but there will be a phased increase to 67 and eventually 68.

The full amount available under the new State Pension is £175.20 a week (£9,110.40 a year) in 2020-‘21, depending on the recipient’s National Insurance (NI) record.

Those with a minimum of 35 years’ NI contributions will receive the full pension amount, those with between 10 and 34 years’ contributions will receive a proportion of the pension and those with less than 10 years’ contributions are ineligible.

“People may receive less than the full flat rate State Pension when their NI record is incomplete or they have paid less than the 35 qualifying years required under the new rules, usually through periods of contracting out,” explained Mr Tombleson.

He advises people to either contact the Department for Work and Pensions or visit their website for an up-to-date State Pension forecast, which is calculated using an individual’s NI record under old and new rules.

If there are gaps in a person’s NI records, he said, they could consider paying voluntary contributions for a maximum of the previous six years.

Mr Tombleson encourages people to ensure that they have claimed credits for periods when they have not worked, possibly through unemployment, looking after children or grandchildren or caring for parents. “This should happen automatically, but mistakes can and do happen, especially if you are self-employed,” he added.

Mr Tombleson is happy to answer questions and advise people on the right pension strategy for them. He may be contacted at Rees Astley’s Newtown office on Tel: 01686 626616.

Business News Wales