Find out how much is the state pension for those retiring at 66 and born in 1954

If you were born in 1956 as a UK citizen, you can retire and qualify for the State Pension when you’re over age 66. But if you take control of your private pension and accumulate a large enough pension pot, you might find yourself in the position of not having to wait for your State Pension to kick in.

Knowing when you qualify for the State Pension can help you plan your financial future and achieve a better quality of life in retirement.

But the complicated pension rules are susceptible to change, so it can be difficult to keep up with the evolving landscape. Not knowing something as simple as when you qualify can disrupt your retirement savings plans, impact how much you have for retirement, or even delay when you hang up your working boots.

People don’t have to reach State Pension age (SPA) to access their private pension funds. You can access your pension savings from the age of 55. You can then decide to take a 25% tax-free lump sum or keep it invested. Whilst many would like to retire at the age of 55, an additional 10 years of saving into your private pension could make a real difference to your quality of life when you retire.

What is state pension, and how does it work?

The State Pension in the UK is a regular payment from the government that most people can claim when they reach the State Pension age. It is a type of financial assistance intended to give retirees a minimal income. It is a flat-rate pension, which means that everyone who qualifies gets the same State Pension amount, regardless of their income or how much they have saved.

The current State Pension age is 66 for both men and women. To qualify for the UK State Pension, you must:

• Be a UK resident.
• Reach the State Pension age.
• Have a certain number of qualifying years based on your National Insurance record.

The number of qualifying years required depends on an individual’s year of birth and when they reached the State Pension age. For example, if you were born on or after 6 April 1951, you will need 35 qualifying years. If you do not have enough qualifying years, you may still be able to get some State Pension amount.

Also, whether you get the basic or full State Pension depends on when you were born and how many qualifying years of National Insurance you have. How much is the State Pension? The full new pension for 2024/25 is £221.20 per week, while the full basic pension for 2024/25 is £169.50 per week.

The State Pension age has been transformed since 2010 when people widely accepted that men would retire later than women. This has been reformed, with the female State Pension age rising to 65 from 2010-2018 and then 66, 67 and 68 for both men and women and this, of course, has an impact on how much pension will married couple get.

Two months before you reach SPA, you’ll get a letter telling you what to do. At this point, you can decide to either take your State Pension or delay it.

By deferring your State Pension, you could increase the amount you get as a weekly income when you come to claim it. The extra State Pension amount is paid with your regular State Pension payment.

As long as you defer for at least nine weeks, your pension will increase each week you defer. So, for every nine weeks of deferment, your pension increases by the equivalent of 1%. This works out to just under 5.8% every full year.

The State Pension is undoubtedly an excellent supplement to the retirement income you generate from a personal pension, but it’s important you ask yourself whether you can comfortably rely on this during retirement.

How is the new state pension calculated?

The new State Pension, which was introduced on April 6, 2016, is calculated based on the number of qualifying years you have on your National Insurance (NI) record. A qualifying year is a year in which you have paid or been credited with NI contributions. If you are wondering, “How much state pension will I get at 66?” – the amount of pension you’ll get depends on how many NI qualifying years you have.

The full new State Pension for 2024/25 is £221.20 weekly. To calculate how much you’ll receive, you’ll need to divide the full amount by 35 and then multiply by the number of qualifying years you have. For example, if you are wondering how much the State Pension amount you will receive with 20 qualifying years of NI, you will receive 57.41% of the full amount, which amounts to £126.40 per week.

The new State Pension is subject to change based on a yearly government review. If you want to check your State Pension, you can use the State Pension calculator​ on the Gov.uk website.

How Many Years of National Insurance Contributions do you need to qualify for the full new state pension?

You need at least 10 qualifying years of NI contributions to qualify for the full amount. The 10 years do not have to be accumulated consecutively. For a man to qualify for the new State Pension, he must be born on or after 6 April 1951, while a woman must be born on or after 6 April 1953. To get the full amount, you need 35 qualifying years. If you have less than 35 qualifying years, you will get a proportion of the full amount.

When will I get my State Pension?

Now that you can answer this question, ‘How much state pension will I get at 66?’- it’s important to note that State Pension differs from personal or workplace pensions. Once you hit the SPA, the government will pay you a regular income throughout your retirement – as long as you’ve built up the required number of years of NI contributions.

You can use the tool on the government website to check when you’ll reach the State Pension age, your pension credit qualifying age and when you’ll be eligible for your free bus pass.

How do I claim my State Pension at 66

In order to start receiving your State Pension, you must first claim it. You will normally receive an invitation letter which you need to complete and return to the Department for Work and Pensions. You can also apply online or by phone. For further details, please refer to the “How to claim your State Pension page” on the government website.

Born in 1956: when can I retire in the UK?

You can retire at any time if you were born in 1956. However, people born in 1956 will be able to claim their State Pension at age 66. If you were born on 1 July 1956, your SPA is 66 years. This means you’ll be eligible for your State Pension on 1 July 2022.

Born in 1957: When can I retire in the UK?

You can retire at any time if you were born in 1957. However, if you were born in 1957, you will be able to claim your State Pension at age 66. If you were born on 15 October 1957, you will be able to claim your pension from 15 October 2023.

Born in 1958: When can I retire in the UK?

People born in 1958 can claim their State Pension at age 66. If you were born on 07 January 1957, you will be able to claim your pension from 07 January 2024.

Before the next increase (in 2028), those born between 1957 and 1960 will be eligible to claim State Pension.

The State Pension age is gradually increasing for people born after 1950 and is scheduled to rise to 67 between 2026 and 2028. This is because the government is trying to make sure that the pension is sustainable in the long term.

When will the state pension age rise to 67?

The government, via the Pension Act of 2014, has decided to bring forward the increase in SPA by eight years.

The SPA for men and women born on or after 6 April 1960 will increase from 66 to 67 between 2026 and 2028. Therefore, if you were born after April 1960, you would start receiving your pension in April 2027. People born from 1961 will reach the SPA of 67 in 2028.

When can I retire if I was born in 1956 and get my state pension if the SPA changes to 67? Well, you will receive your pension when you reach SPA in 2022 at the age of 66; the changes will not affect you.

When will the state pension age rise to 68?

Under the Pensions Act 2007, the SPA for men and women born on or after 6 April 1977 will increase from 67 to 68 between 2044 and 2046.

In July 2017, the government announced that the further State Pension review, which occurred in 2023, will determine if the UK government will increase the SPA from 67 to 68 by seven years. If the legislation moves the date forward, the new dates will be between 2037 and 2039.

If the date is brought forward, this would mean that the SPA for men and women born between 6 April 1970 and 5 April 1978 can be 68, as it all depends on their date of birth. Those born between 1962 and 1976 will reach the SPA of 67 before the next projected pension increase in 2044.

Difference between old and new state pensions?

The old and new State Pensions are two different systems of state-provided retirement benefits in the UK. There are some differences between the two.

Qualifying Years: To qualify for the old pension, you must have at least 30 qualifying years of NI contributions to receive the full amount. For the new pension, you need to have at least 10 qualifying years to be eligible and 35 qualifying years of NI contributions to receive the full amount.

Pension Amount: The maximum amount for the new State pension is more than the maximum for the old one, and the new one provides a higher flat-rate amount for those who meet the minimum qualifying years. However, the amount under both systems relies on an individual’s NI record.

Pension Calculations: The old pension calculation was based on NI contributions plus the additional State Pension based on your earnings (additional means-tested benefits). In contrast, the pension calculation process uses a single-tier pension based solely on an individual’s NI record.

Additional Pension: Under the old pension, individuals had the opportunity to build additional State Pensions through schemes like SERPS or S2P, which were earnings-related. In contrast, the new pension consolidates these additional pensions into a single-tier system, thus streamlining the process.

Regular investment plans for investors

The two golden rules of retirement savings are starting as early as possible, and saving as much as possible. But when navigating through retirement planning, asking yourself, “How much State Pension will I get at 66?” is only part of the equation. You still need to know if you’re doing enough in terms of making regular investments to be on track to have the retirement you want?

Let’s examine three regular investment plans to help you understand whether you’re on track to get your desired retirement income. These savings plans of £400 a month, £800 a month and £1,600 a month, net of tax relief or employer contributions, fall well within the top annual allowance threshold and represent contribution levels reflective of different life stages.

Some corporate schemes offer generous top-ups to pension contributions, which may be worth taking advantage of.

As you get older, your priorities change, and some of your big outgoings will stop. You’ll pay your mortgage off, and your children will become more independent. You should look to put as much of this extra cash into your private pension to boost your retirement income.

By setting aside this much each month, you could be on track to a comfortable retirement income in less time than you think.

According to the FCA, it’s reasonable to expect that you can earn an annualised return of at least 5% from a balanced and diversified portfolio over the long term. Assuming 5% is your return, you can withdraw 5% from your pension each year. So, theoretically, you’ll never deplete the nominal value of your pension.

That means that for an annual income of £25,000, you’ll need a pension pot worth £500,000. For £37,500 a year, you’ll need £750,000.

Understanding the Impact of Brexit on State Pension in the UK

Brexit has been a topic of significant concern for many UK citizens, especially those nearing retirement age. One question that often arises is, “When can I retire if I was born in 1956?”.

While the SPA remains at 66, Brexit has introduced some uncertainties that could affect your retirement plans, particularly if you’re asking yourself, “How much State Pension will I get at 66?”

Firstly, Brexit has led to fluctuations in the value of the pound, which could impact the real value of your State Pension over time. If you’re considering retiring abroad, especially in an EU country, the exchange rate could affect how much you receive in local currency.

Secondly, the UK’s exit from the EU has raised questions about the “triple lock” guarantee. This mechanism ensures that the pension rises by the highest of three measures: inflation, average earnings, or a minimum of 2.5%. While the previous government committed to maintaining the triple lock, continuing economic pressures following Brexit could put it under review. If you are wondering, “How much State Pension will I get at 66 if I live abroad”, it depends in which country you live.

Lastly, if you’ve worked in other EU countries, Brexit could affect how those years are counted towards your UK State Pension. Prior to Brexit, years worked in the EU were aggregated with UK NI contributions to calculate your pension amount. However, the rules have changed, and it’s crucial to check how this might affect your entitlement. It’s essential to stay updated and possibly consult a financial advisor to understand how, post Brexit, it could impact your retirement plans.

How to plan for retirement

By taking control of your pension savings plan early enough, you can have more flexibility over when you retire. Follow these four simple steps and get a step closer to getting the retirement you deserve.

• Get cost-efficient investment advice – Building the right portfolio that reflects your goals, financial background, and appetite for risk can be challenging. Cost-efficient investment advice can help you make the right financial decisions for your future.
• Invest in a pension that changes to reflect you – Priorities change over time, and your investments must reflect that change. At Moneyfarm, we regularly run our suitability algorithms to ensure your investments put you in the best position for success. If they don’t, we’ll match you with the portfolio that does. This is all free of charge and part of our ongoing commitment to help you reach your goals.
• Consolidate your pensions – It can be difficult to manage several different pensions. By transferring old pensions into one place, you can lower costs and comprehend what you have. By knowing the value of your pension, you can make the necessary adjustments to reach your goals.
• Make the most of generous tax benefits – Basic tax relief means that most people get a 25% top-up to each contribution they make from the government. The tax relief system encourages Brits to save for their future, providing basic rate taxpayers with 20% tax relief, higher rate taxpayers with 40%, and additional rate taxpayers with 45% tax relief. If you fall in the higher or additional bucket, make sure you apply for further relief through HMRC to make the most of your money.

Our free Pension Drawdown Service helps you make confident, stress-free decisions to stay in control of your retirement income.

You can use Moneyfarm’s Pension Calculator to help you work out how much you need to be saving a month to get the income you want in retirement or start one of Moneyfarm’s regular investment plans.

Making sure you plan for retirement in the best way for you and your family can be difficult. If you need any help, talk to an independent financial adviser and be sure to read our pension guide.

Supplement your retirement income with a stocks and shares ISA

If, having used our pension calculator and the answer to the question, “How much state pension will I get at 66?” doesn’t look like it will be enough, even with a SIPP or workplace pension added, you might want to consider your options. The problem is that the taxman will take his share, so consider opening a stocks and shares ISA. ISAs are tax wrappers, and any income you receive from them will be completely tax-free.

With private pensions (including workplace pensions), you can save up to £60,000 per annum tax-free. This might sound like a lot of money if you are in the upper earnings bracket. But once the taxman has claimed 40% or 45% of any income in your retirement, you will be saying goodbye to a huge chunk of your retirement income if you’re a higher or additional rate taxpayer.

However, if you put up to £20,000 per annum into a stocks and shares ISA, your fund will grow thanks to compound interest, and any earnings you make from share dividends or any withdrawals you make will be tax-free.

Even if you are not a high earner, consider this tax-free income option as part of your retirement income plan.

FAQ

How long after my 66th birthday will I get my State Pension?

After claiming your State Pension, the first payment will usually be within five weeks, and you will receive the full payment every four weeks after that.

Can I retire at 60 and claim State Pension in the UK?

No, you can only claim your State Pension when you reach the State Pension Age.

When can I retire if I was born in 1956?

You can retire at any time if you are born in 1956, but to qualify for the State Pension, you must be over age 66.

How long after my 66th birthday will I get my state pension?

Once you’ve initiated your State Pension claim, you can expect the initial payment to arrive within five weeks, followed by regular payments every four weeks thereafter.