State Pension
BeginnerA State Pension is a regular payment made by a government to people who have reached a set retirement age, usually based on their record of social insurance contributions or residence.
Most countries provide some form of state pension to give older people a basic income. The rules for qualifying, the age at which it can be claimed and the amount paid vary widely.
In the United Kingdom, the new State Pension is based on a person’s National Insurance record and is paid from State Pension age, which is 66 and is rising to 67 between 2026 and 2028, with a further increase planned later. Under the triple lock policy, it has been increased each year by the highest of inflation, average earnings growth or 2.5%.
For example, someone with a full National Insurance record would receive the full new State Pension, while someone with fewer qualifying years would receive a proportionally smaller amount.
State pensions are usually paid from current taxes and contributions rather than from invested savings. Ageing populations put pressure on these systems, leading many governments to raise pension ages. Because state pensions alone are often modest, most people also need workplace or personal savings to maintain their living standards in retirement.
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