Martin Lewis has informed those in receipt of the state pension of a method that could see them almost quadruple what they get back. The money-saving expert has made a name for himself over the years by providing tips on how to save money and enhance income in a variety of areas.
But the financial guru believes that his most recent piece of advice is the most important he has given in the last three years. He told This Morning: “This is about a deadline on the 5th April for buying back old, missing national insurance years. This is all because the new state pension was brought in in 2016 that applies to men who were born after the 5th April 1951, so 73 and younger.
“Women who were born after 5th April 1953, so 71 and younger and what it means is that when they brought in the new state pension, they had transitional arrangements that said you could buy back to 2006.”
He added: “So normally you can only buy back six years of missing years but they said you can buy back to 2006.”
The buying back of missing years can refer to people who lived abroad, who didn’t earn enough in a particular year, or had a work break, something that Lewis says, is very common for women.
Originally, the deadline to buy back these “missing years” was in 2023 but it has been extended to 5 April, a deadline that Lewis warns, will not be pushed back again.
He continued: “Right now you can buy back missing years all the way back to 2006. After that date, you can buy back only for the last six years.”
The deadline could prove hugely significant for those eligible to buy back years, with Lewis giving one example of “one of thousands” of emails that he had received on the subject.
The emails author detailed how her 11 years of contributions had caused her to overpay her pension, saying that Lewis’s advice had given her an additional £5,916 a year, which over two decades, would save her an incredible £118,000.
Lewis warns that in order to buy back the missing years, you do not yet have to be at state pension age, with those aged 40-73 most likely to require checking their eligibility.
The issue relates to the number of years people have paid national insurance for. Lewis explained that each year, people must pay a certain amount to be classed as having paid for that year, with those who fall short, regardless of by how much, being classed as not having paid.
In Lewis’s example, those who fell short of the threshold in certain year by £20, could pay the £20 to be classed as having paid national insurance in that year. Each year could entitle recipients to £300 in their state pension per year claimed.
Lewis advises that those looking to check for their eligibility should head to gov.uk to check their national insurance record.
