How to increase your state pension using your husband’s National Insurance record.

MFtwocups3

Updated August 30th 2012

Government figures show that around 25% of women don’t get the full basic state pension when they retire. OK so the state pension may not be a fortune at around £107 a week, but for many people (especially women) it’s the bedrock of the money they live on in retirement. If you haven’t paid enough National Insurance to get a full pension you may be able to claim a pension, worth up to 60% of the full basic state pension, based on your husband’s NI record. What’s more you can still do it even if you’re divorced.

Finding out about your state pension
The way the state pension works is that everyone can qualify for a full state pension of £107.45 a week (tax year 2012-13) as long as they’ve made enough National Insurance contributions. If your husband has a better NI contributions record than you do, you’ll be better off claiming under his record.

– It will depend on how long you’ve worked for, how much you earned (if you earn less than the lower earnings limit, you don’t pay NI) and whether you were credited for years spent looking after your children or caring for relatives.

– Under the rules introduced on April 6th 2010, women (and men) must pay or be credited with NI for 30 years to get a full basic state pension. You can get an indication of the state pension you may be entitled to by filling in the state pension profiler.

SAVVY TIP: If you’ve taken time off work to look after your children, you may have received home responsibilities protection (which essentially credits you for time when you’ve been looking after your children).

– Ask for a forecast of the pension you are in line to receive. A state pension forecast, is something you can apply for online or by phone.

Claiming on your husband’s National Insurance record
If you haven’t paid enough NI to receive a full basic state pension in your own right, you can claim on your husband’s (or ex husband’s) National Insurance record.

– You’ll receive a pension worth 60% of his. If he’s entitled to the full basic state pension that means you’d receive a pension of over £64 a week (in tax year 2012/13).

SAVVY TIP: From April 6th 2010, a man has been able to claim on his wife’s NI record and civil partners will be able to claim on each other’s if the wife or civil partner was born after April 6th 1950. In reality, it’s unlikely that many men would be better off claiming on their wife’s NI record, although for some, it may be a help.

– Always ask how you can maximise your state pension. Find out whether you’d be better off claiming under your husband or ex husband’s National Insurance record rather than under your own.

SAVVY TIP: I’ve checked this with the Department for Work and Pensions, which says that if you’re married, you won’t be given information about whether or not you’d be better off claiming the state pension under your husband’s NI record. If you’re divorced, you should be given that information. If you want advice on what to do, call the Pensions Advisory Service on 0845 6012923.

– Find out whether your husband should get a state pension forecast. If your husband doesn’t know how much of a pension he may be entitled to at retirement, he should get his own state pension forecast.

SAVVY TIP: If you claim on your husband’s National Insurance record it won’t affect the pension he receives in any way.

– If you’re claiming on your husband’s NI record, he must have reached state pension age and has to be drawing his pension before you can receive yours.

SAVVY TIP: From April 6th 2010 the rules changed so that your husband won’t have to have started claiming his state pension for you to use his NI record to claim yours, however he does have to have reached state pension age.

State pension and divorce
The rules around claiming your state pension on your ex husband’s National Insurance record aren’t complicated, so it’s worth understanding exactly how they work. It’s also worth knowing that women and men can claim on their ex’s National Insurance record already.

– If you claim using your ex husband’s National Insurance, it can be calculated either for the tax years up to the tax year in which the marriage ended or the whole of your ex husband’s record up to the date of divorce (whichever gives you the bigger pension).

SAVVY TIP: You can only use your ex husband’s National Insurance record if you don’t remarry before you reach state pension age.

– Your ex husband doesn’t have to be told. If you’re using his NI record to claim your pension, he doesn’t have to know about it. All you need to provide is his National Insurance number.

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Related articles:

How to retire comfortably

Approaching retirement; how to prepare

What to do with your tax-free pension lump sum

SAVVY HELP: Tony Attubato of the Pensions Advisory Service is one of SavvyWoman’s panel of experts. You can ask Tony a question about any state pension issue by clicking here. The answer will be displayed on the website but your surname will never be used.