Tom Selby, senior analyst at AJ Bell, comments:
“The state pension is the bedrock upon which savers’ retirement futures are built and so it is essential to know how much you will get, and when.
“While the new flat-rate state pension for future retirees of around £155 a week is fairly straightforward to understand, the old system under which many people accrued benefits was riddled with complexity. This means some people reaching state pension age in the coming years will be entitled to more than the flat-rate amount – and some a lot less.
“Furthermore, the full flat-rate state pension amount is only available to those who build up 35 years of National Insurance contributions, with a minimum of 10 years needed to get anything at all. You can also get NI ‘credits’ if you are not in full-time employment but receive child benefit, get jobseekers’ allowance or care for an elderly relative.
“Ultimately it’s never too early to start thinking about retirement. But the older you are the more urgent it is to get your affairs in order and make sure you know what you’re likely to get from the state, and how much you’ll need on top of that to fund your retirement.”