Your browser isn't supported
It looks like you're using an old web browser. To get the most out of the site and to ensure guides display correctly, we suggest upgrading your browser now. Download the latest:

Welcome to the MSE Forums

We're home to a fantastic community of MoneySavers but anyone can post. Please exercise caution & report spam, illegal, offensive or libellous posts/messages: click "report" or email forumteam@.

Search
  • FIRST POST
    • MSE Helen Saxon
    • By MSE Helen Saxon 31st Mar 16, 1:09 PM
    • 75Posts
    • 43Thanks
    MSE Helen Saxon
    New State Pension Guide
    • #1
    • 31st Mar 16, 1:09 PM
    New State Pension Guide 31st Mar 16 at 1:09 PM
    Hi!

    This is the discussion thread for the



    Click reply below to discuss. If you havenít already, join the forum to reply. If you arenít sure how it all works, read our New to Forum? Intro Guide.


    Thanks folks,
Page 19
    • p00hsticks
    • By p00hsticks 17th Oct 17, 3:15 PM
    • 5,783 Posts
    • 5,565 Thanks
    p00hsticks
    1. Is there any point in paying the £243.50 from 2013-14 and / or £705 from 2015-16? If I do, will that increase my current £130.62pw figure?
    Originally posted by greensea27
    No - as you have over the 30 years NI required under the old rules, increasing the number of pre-2016 years won't help you.

    2. As I very much doubt I'll be working again between now and receiving my State Pension in 2025, I presume I can, between now and then, 'buy' the extra 6.5 years I require to boost my SP to the £159.55pw quoted. Is that correct?
    a
    Originally posted by greensea27
    Yes you can - although I think your pension is only calculated in whole years. Each full year adds 1/35th of the maximum £159.55 to your pension (around £4.55), up to the maximum. so buying six years will take you up to around £158.00 a week, whilst buying a seventh year will only get you about an additional £1.55, so not as good value as the first six years.
    • gadgetmind
    • By gadgetmind 17th Oct 17, 6:19 PM
    • 10,652 Posts
    • 8,463 Thanks
    gadgetmind
    Here's something that was predictable but unpredicted (by me).

    At the time everyone got foundation amounts, I was a good way ahead of the single tier max due to lots of S2P and not much contracting out. But the single tier has risen with inflation while my number was "frozen", so I'm now at max. So all the extra NI I paid has been effectively spirited away, so I'm *really* glad that I contracted out and have a £75k pot thanks to that.
    I am not a financial adviser and neither do I play one on television. I might occasionally give bad advice but at least it's free.

    Like all religions, the Faith of the Invisible Pink Unicorns is based upon both logic and faith. We have faith that they are pink; we logically know that they are invisible because we can't see them.
    • greensea27
    • By greensea27 18th Oct 17, 9:24 AM
    • 22 Posts
    • 3 Thanks
    greensea27
    Thanks p00h - one last question if I may. I've read that there's little point in buying any extra years before you need to (i.e. upon the point of claiming SP) just in case you pop it before reaching State Pension age. But are you time limited in how many you can buy? Can I (hypothetically) buy the 6 I need in early 2025, or will it be better to buy them gradually over the next few years?
    • molerat
    • By molerat 18th Oct 17, 10:29 AM
    • 17,478 Posts
    • 11,705 Thanks
    molerat
    You can buy years up until 6 years after the end of the year. They stay at the in year price for 2 years after the end of the year but increase to the current year price after that.
    Last edited by molerat; 18-10-2017 at 10:31 AM.
    www.helpforheroes.org.uk/donations.html
    • GunJack
    • By GunJack 18th Oct 17, 11:00 AM
    • 9,882 Posts
    • 7,361 Thanks
    GunJack
    Here's something that was predictable but unpredicted (by me).

    At the time everyone got foundation amounts, I was a good way ahead of the single tier max due to lots of S2P and not much contracting out. But the single tier has risen with inflation while my number was "frozen", so I'm now at max. So all the extra NI I paid has been effectively spirited away, so I'm *really* glad that I contracted out and have a £75k pot thanks to that.
    Originally posted by gadgetmind
    but your basic newSP will increase by triple lock in line , and your protected amount (above the £155-odd) by a smaller amount (just cpi i think) between now and claiming it, so not frozen, just can't accumulate more in SP, just in your private pension.

    Your NI pays for more than just SP, so it's not been "spirited away"...
    ......Gettin' There, Wherever There is......
    • gadgetmind
    • By gadgetmind 18th Oct 17, 12:54 PM
    • 10,652 Posts
    • 8,463 Thanks
    gadgetmind
    but your basic newSP will increase by triple lock in line , and your protected amount (above the £155-odd) by a smaller amount (just cpi i think) between now and claiming it, so not frozen, just can't accumulate more in SP,
    Originally posted by GunJack
    True, but my S2P payments count for nothing (but no choice other than to pay) and nor was there any point contracting back in when I did. Still, you can only act based on what you know at the time.

    just in your private pension.
    Nope, maxed out.

    Your NI pays for more than just SP, so it's not been "spirited away"...
    Well, it's going to people other than me, which is the same in my book.

    As I can't get any more SP or private pension, it may be time for pipe and slippers!
    I am not a financial adviser and neither do I play one on television. I might occasionally give bad advice but at least it's free.

    Like all religions, the Faith of the Invisible Pink Unicorns is based upon both logic and faith. We have faith that they are pink; we logically know that they are invisible because we can't see them.
    • GunJack
    • By GunJack 18th Oct 17, 3:35 PM
    • 9,882 Posts
    • 7,361 Thanks
    GunJack
    True, but my S2P payments count for nothing (but no choice other than to pay) and nor was there any point contracting back in when I did. Still, you can only act based on what you know at the time.

    your SERPS/S2P payments built up part of your newSP and your protected amount, and contracting out for everyone ended over the last 5 years.... remember the basic old SP was £119pw, so your S2P built up everything over that

    Nope, maxed out.

    so you still put £2880 in every year still, or are you over 75?

    Well, it's going to people other than me, which is the same in my book.

    never needed the NHS, or any state benefits yet?
    Unlikely you'll go all your life without either/both, if you've paid NI you're ok, you're covered


    As I can't get any more SP or private pension, it may be time for pipe and slippers!
    Originally posted by gadgetmind
    Not trying to be argumentative, just saying....
    ......Gettin' There, Wherever There is......
    • gadgetmind
    • By gadgetmind 18th Oct 17, 3:43 PM
    • 10,652 Posts
    • 8,463 Thanks
    gadgetmind
    so you still put £2880 in every year still, or are you over 75?
    Originally posted by GunJack
    No, can't put any more in as at (OK, over thanks to Brexit) current LTA.

    As for cash state benefits, I'll get state pension at age 67 but nothing else unless you count bus pass, which will probably be means tested by then along with everything else! NHS you get no matter how little NI you've paid. Me paying more NI now won't get me anything in return so I'm less than enthusiastic to be doing it.

    Not trying to be argumentative, just saying....
    Originally posted by GunJack
    Understood and appreciated.
    I am not a financial adviser and neither do I play one on television. I might occasionally give bad advice but at least it's free.

    Like all religions, the Faith of the Invisible Pink Unicorns is based upon both logic and faith. We have faith that they are pink; we logically know that they are invisible because we can't see them.
    • macg1953
    • By macg1953 29th Nov 17, 11:07 PM
    • 2 Posts
    • 0 Thanks
    macg1953
    State Pension deduction for being contracted out?
    Firstly apologies for asking this question, it has been asked before, but answered ambiguously in a very complex manner.
    Quite simply, I am 64 and will receive state pension next year. I have 45 full qualifying years, during which I was contracted out of Serps until 1996. Possibly 25 years in total. After this I was contracted back in and paid full NI until 2 years ago.
    I obtained my state pension forecast which came in at just over £177 per week BUT my COPE estimate for contracting out is £77.
    My question simply is, will I receive full forecast £177 or will this be reduced by the COPE estimate, giving me £107 per week (rounded up by the government safety net to £119 per week)
    The forum answers vary in complexity and some some yes I will receive the full £177, others say no. The government helpline tell me that my £177 will NOT have a deduction, meaning I will get the full £177 per week,
    Non-complex replies to this will be much appreciated!
    • hyubh
    • By hyubh 29th Nov 17, 11:58 PM
    • 1,980 Posts
    • 1,491 Thanks
    hyubh
    My question simply is, will I receive full forecast £177 or will this be reduced by the COPE estimate, giving me £107 per week
    Originally posted by macg1953
    The COPE figure isn't taken off, it's already been accounted for when determining your starting amount under the new state pension regime.

    The forum answers vary in complexity and some some yes I will receive the full £177, others say no.
    Where so for the latter...? A potential issue is that the forecast will be assuming NI contributions to the year before SPA, but as you're already there, that consideration doesn't apply.
    • xylophone
    • By xylophone 30th Nov 17, 12:11 AM
    • 23,647 Posts
    • 13,778 Thanks
    xylophone
    If your forecast is £177 a week, that is what ( increased as below) you will get.

    At 6/4/16, two calculations were done.

    (1) Old rules

    Full Basic State Pension (£119.30) + (SERPS/S2P - Deduction for contracting out).

    (2) New rules

    (35/35 X £155.65) - COPE.

    Your "starting amount" was the higher of the two.

    It would seem that although you had a contracted out deduction, you had accrued enough additional pension after your contracting out ended for calculation (1) to be £177.

    https://www.gov.uk/new-state-pension/how-its-calculated

    You have a full new state pension plus a protected payment - see above link for how it increases in payment.
Welcome to our new Forum!

Our aim is to save you money quickly and easily. We hope you like it!

Forum Team Contact us

Live Stats

120Posts Today

3,045Users online

Martin's Twitter