Retirement: Are you one of the 50% of workers to miss out on the flat rate State Pension?


Are you one of the 50% of workers to miss out on the flat rate State Pension?New figures have shown that millions of workers retiring from 2016 will not receive the full flat rate State Pension.

In fact, the research completed following a Freedom of Information request by Hargreaves Lansdown has shown that in the first five years nearly two million people will miss out on the full flat rate State Pension.

The Government has introduced the flat rate State Pension an effort to simplify the complex system, whilst ensuring that saving into a private pension was worthwhile and didn’t simply reduce the means tested benefits available.

The flat rate State Pension will start from April 2016 and could pay up to £148.40 per week. However, it now seems millions will miss out, with only 45% of people reaching their State Pension age between 2016 and 2020 qualifying for the full amount.

In response to the revelations the Government has defended the new system, confirming that no one will be worse off than under the old system.

Why are people getting less?

There two main reasons why some pensioners get less than the full flat rate.

Opting out For decades now it has been possible to opt out of the top up to the State Pension. Those people who ‘contracted-out’ of the top up, which has been known as SERPS (State Earnings Related Pension) and S2P, will receive a smaller flat rate State Pension, as they have been able to build up their own individual pot from the National Insurance rebates they were entitled to after opting out.

Insufficient contributions To qualify for the full flat rate State Pension pensioners must have paid National Insurance for at least 35 years. Those people, who haven’t made sufficient contributions, often working mothers and the self-employed, will get a smaller State Pension.

How can you find out if you are affected?

If you are worried, or would simply like to find out if you will qualify for the full flat rate, you should request a State Pension forecast, which you can do by clicking here.

We’re here to help too

Alternatively, our team of advisers are here to help you.

Call us today on 0115 933 8433 or email and we’ll guide you through the State Pension maze.