Parents may be losing out in retirement because they’re unaware of Child Benefit link

PARENTS or guardians may be able to boost the amount of state pension they’re entitled to using a simple mechanism.

Martin Lewis explains who is eligible for Child Benefit

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By taking action now, parents or guardians can potentially protect their state pension for 12 years and live a more comfortable retirement.

This can be done by claiming Child Benefit.

It means people won’t have to diminish their retirement because they raised a family instead of working.

Many parents are unaware of the link between tax credits and state pensions.

By claiming Child Benefit, people can get National Insurance credits which count towards their state pension.

It also means that the child will automatically get a National Insurance number when they reach the age of 16.

Those registering with a child under 12-years-old should qualify for Class Three National Insurance credits, even if they don’t receive the Child Benefit payments.

Foster carers or kinship carers in Scotland also need to apply for these Class Three Credits.

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state pension

Parents may be missing out in retirement because of unawareness (Image: Getty)

This rule gives parents and guardians the power to protect their state pensions for up to 12 years.

Even those who will lose some of the Child Benefit because they are impacted by the High Income Child Benefit Charge (HICBC) can get the credits.

HICBC is triggered when a person or their partner’s individual income exceeds £50,000.

Once earnings are above £60,000, all of the benefit will be lost through HICBC.


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The government advises that even if people don’t receive the payment, they should still complete the form.

You are entitled to Child Benefit if you’re responsible for raising a child who is either under 16 or under 20 and in approved education or training and you live in the UK.

The Child Benefit allowance is £21.15 a week for the first child, dropping to £14 for every child after that and there is no limit to how many children a person can claim for.

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Only one person can claim Child Benefit for a child.

In 2019 HM Revenue & Customs (HMRC) released a report saying people had a good understanding of most aspects of child benefits.

However, parents had far less awareness of HICBC and the benefits to pensions associated with Child Benefit.


State pension information (Image: Express)

It is important for parents and guardians to be aware of this because the advantages of someone adding to their pension while not working is great.

According to Royal London, missing one year’s worth of NI contributions can reduce the state pension by 1/35 overall.

This works out to about a £244 loss per year of retirement, or nearly £5,000 over the course of a 20-year-long retirement.

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