It doesn't pay to wait, warns Friends Provident

Friends Provident is urging people to check their National Insurance (NI) contribution record is up to date before 6 April 2009.

From that date the Government will be increasing the cost of buying back missing NI contributions to help people qualify for or improve their entitlement to the basic State pension - buying so called ‘additional years'. Anyone in this situation will be faced with a whopping 49 per cent increase in the cost of doing so.

Martin Palmer, head of corporate pensions marketing said: "Many people may not be aware of the option to buy back additional years or don't understand the issues involved. There is plenty of useful information available to help people with a variety of pensions issues and nobody should miss the boat by being too wary of asking for advice.

"The full basic State pension for a single person is currently £90.70 a week and is the foundation for everyone's retirement planning. From April 2010 the Government is changing the way that entitlement to the basic State pension is calculated. You will require fewer ‘qualifying years' but the cost of buying any missing years by topping up your national insurance record increases at the end of this tax year.

"Currently 70 per cent of women and 15 per cent of men do not receive the full basic State pension. So if, like them, you think you will not have accrued a full NI contribution record before you retire, it may be in your interest to act sooner rather than later."

To help people make an informed decision about whether it would be beneficial for them to buy back NI contributions, Friends Provident has produced a handy guide that is available at friendsprovident.com/membersite