Pensions are a way of saving for retirement to provide yourself with a regular income with tax benefits when you stop working. There are three types of pension.
A state retirement pension (SRP) (Category A pension) is a weekly sum and the amount paid can be different from one person to another person as it depends on:
the individual’s National Insurance Contributions (NICs) and
how many years they have been in employment.
If you are a man, it is paid when you reach 65 and for a women it is paid at age 60. Equal state pension age of 65 for both men and women will be phased in between 2010 and 2020.
Some married women and civil partners of pensionable age may qualify for SRP (Category B pension), even if they have never worked and have never paid NICs. Their husband or civil partner must be getting a Category A pension.
For a state pension forecast telephone the State Pension Forecasting Team on 0845 300 0168.
If you have paid the correct amount of National Insurance then you are entitled to a State pension when you reach 65. This is a weekly sum which varies depending on your age, your NI contributions and how many years you have been in employment.
There are also company or occupational pensions, set up by employers, and the terms of these pensions may vary according to the individual employers.
Finally, personal pensions – available from banks, building societies and life insurance companies – can invest your savings on your behalf.