New rules

24

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  • Triumph13
    Triumph13 Posts: 1,730
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    alfonso wrote: »
    Forgive me in advance for having some dumb moments.
    Think I need a reboot of the brain here as the numbers aint adding up or I am reading the forecast wrong
    I have 35 years of full contributions
    11 years to contribute before 5 April 2026 ( at an average 700gbp/pa )

    5 years when I did not contribute enough (again 700gbp/pa )
    That would make 51yrs of contributions to get the new full SP
    You're mixing up lots of different things there. 2026 is when you get the state pension and if you were working then you would still be paying NI for another 11 years. As you're not, you won't be.
    The 5 years where you didn't contribute are happy as they are. Forget them completely as they would have made no difference to your pension at all as they were on the old SP and you already have the full old SP.
    You are now in the great position that another 8 years of voluntary NICs for years after April 2016 will bring you up to virtually the full new type SP.
  • molerat
    molerat Posts: 31,683
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    RoseV wrote: »
    The Breakdown of my pension states:

    Estimate based on your National Insurance record up to 5 April 2016
    £153.58 a week
    Forecast if you contribute another year before 5 April 2023
    £155.65 a week
    £155.65 is the most you can get


    It also states:
    Summary
    38 years of full contributions
    7 years to contribute before 5 April 2023
    4 years when you did not contribute enough

    I was a member of a final salary pension scheme prior to 1996.
    If I look at the COPE page it states:
    Contracted Out Pension Equivalent (COPE)

    Your workplace or personal pension scheme should include an amount of pension which will, in most cases, be equal to the additional State Pension you would have been paid. We call this amount your Contracted Out Pension Equivalent (COPE). Your COPE estimate is shown below.

    The COPE amount is paid as part of your other pension schemes, not by the government. The total amount of pension paid by your workplace or personal pension scheme will depend on the scheme and on any investment choices.

    Your COPE estimate is £56.75 a week.


    So does this mean I will only get paid £98.90 (£155.65 - £56.75) even though I will have paid in for 45 full years by the time I retire?

    Yours confusedly,

    Rose!
    You have currently accrued £153.58 and as you have a COPE shown this will be what you had under the old system and nothing will reduce this amount. The maximum you can achieve is £155.65 no matter how many more years you contribute for. Working for this year will take your pension entitlement up to that maximum of £155.65


    The COPE figure was only used to calculate the starting amount at April 2016 which was the higher of :

    Old 30 = £119.30 + additional pension of £34.28 = £153.58
    or
    New 35 = £155.65 - COPE of £56.75 = £98.90
  • RoseV
    RoseV Posts: 17 Forumite
    So it looks like you are saying that, as I am working this year, I will receive the full £155.65?

    Phew! And thanks!

    I was suddenly worrying about reworking my retirement plans!

    Rose :-)
  • zagfles
    zagfles Posts: 20,274
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    The thing to remember is that you haven't got 35 "full years" if you were ever contracted out - most final salary schemes were contracted out - you and your employer paid reduced NI in return for replacing part of the state pension with your employer's pension.

    As above a quirk in the new rules is that you're allowed to make up that part of the state pension replaced by the employer's pension, by paying NI between now and state pension age. So you can have your cake and eat it, sort of!
  • bigfreddiel
    bigfreddiel Posts: 4,263 Forumite
    plumduff55 wrote: »
    Hi, I am completely confused by this as well.

    I checked last year before retiring and had 42 years contributions so I thought I would be eligible for the full state pension and retired in October.

    After hearing the clip on BBC this morning, I've just checked the pensions website that states I am eligible for £132.37 and would have to contribute till October 2021 (age 66) to receive the full pension.

    I am really shocked by this as I am using my savings to supplement my small NHS pension till age 66. I hope someone comes along soon that can explain this.

    Sorry for jug hijacking your thread Alfonso but this may explain your situation as well xx
    What exactly did you check last year?

    If it was your pension amount how could you be shocked, surely you already knew?

    Cheers fj
  • plumduff55
    plumduff55 Posts: 859
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    zagfles wrote: »
    The thing to remember is that you haven't got 35 "full years" if you were ever contracted out - most final salary schemes were contracted out - you and your employer paid reduced NI in return for replacing part of the state pension with your employer's pension.

    As above a quirk in the new rules is that you're allowed to make up that part of the state pension replaced by the employer's pension, by paying NI between now and state pension age. So you can have your cake and eat it, sort of!

    Thank you zagfles - you've explained my query re the years contributions paid. I did not realise that I was contracted out but now it makes sense. I'll get in touch with pensions next week and probably pay monthly. Many thanks
    Debt free - Mortgage free - Work free ( in that order :) )
  • plumduff55
    plumduff55 Posts: 859
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    What exactly did you check last year?

    If it was your pension amount how could you be shocked, surely you already knew?

    Cheers fj

    Hi, I wrote to pensions and was advised I had 42 years contributions paid. I knew that I needed 35 years contributions and wrongly surmised I would be entitled to the full flat rate of pension when I reached 66. I did not even know I was contracted out. But thanks to zagfles helpful reply I now understand.
    Debt free - Mortgage free - Work free ( in that order :) )
  • Apollonia
    Apollonia Posts: 408
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    Royal London published a booklet online yesterday that may be useful to the posters here. The link takes you to a page where you can download the pdf - Topping up your State Pension.

    http://www.royallondon.com/about/media/good-with-your-money/
  • fifeken
    fifeken Posts: 2,700
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    I thought I'd got a handle on this but the OP has given me some doubts.

    My record on the .gov.uk website says 37 years of full contributions, from 16 years old until now (no breaks or missing years). It also says I was contracted out for some of that time (which I knew) and gives a forecast of £156.57 per year, just above the OPs. Cope estimate of £51.15 per month.

    I thought this meant I was under the old system, but had enough time when I was contracted in to give me additional pension of £37.27 giving me the sum mentioned.

    Can someone confirm or point out where I'm going wrong?
  • zagfles
    zagfles Posts: 20,274
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    fifeken wrote: »
    I thought I'd got a handle on this but the OP has given me some doubts.

    My record on the .gov.uk website says 37 years of full contributions, from 16 years old until now (no breaks or missing years). It also says I was contracted out for some of that time (which I knew) and gives a forecast of £156.57 per year, just above the OPs. Cope estimate of £51.15 per month.

    I thought this meant I was under the old system, but had enough time when I was contracted in to give me additional pension of £37.27 giving me the sum mentioned.

    Can someone confirm or point out where I'm going wrong?
    Why do you think you're going wrong? It sounds like you have enough in SERPS/S2P to take your "old rules" amount above the new full state pension.
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