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  • FIRST POST
    • frugal90
    • By frugal90 16th Oct 16, 1:47 PM
    • 188Posts
    • 44Thanks
    frugal90
    teachers pension and new state pension but only 54 at the moment
    • #1
    • 16th Oct 16, 1:47 PM
    teachers pension and new state pension but only 54 at the moment 16th Oct 16 at 1:47 PM
    Now someone will know the answer to this, I hope.

    I plan to retire when I am 57 from a career in teaching ( in 2 and a half years time)- I was opted out until April of this year
    .
    I will have the full 35 years NI credits - my recent state pension came in at £119 per week and I am aware that this will grow until I am 57- probably by £12 ish to £131 per week. I am aware we are now in a new state pensions scheme and each year is worth about £4 ish

    Will I be able to make additional contributions when I stop working - class3, I think they are called in order to make the £131 up to the full £155- there will be a shortfall of £24 using todays numbers.

    My wife is a bit younger but will be in a similar position.

    Thanks for any help
Page 1
    • Silvertabby
    • By Silvertabby 16th Oct 16, 2:07 PM
    • 371 Posts
    • 397 Thanks
    Silvertabby
    • #2
    • 16th Oct 16, 2:07 PM
    • #2
    • 16th Oct 16, 2:07 PM
    I plan to retire when I am 57 from a career in teaching ( in 2 and a half years time)- I was opted out until April of this year
    Frugal - I do hope you meant to say that you were contracted out (of SERPS/SP2) and not opted out (of the Teacher's Pension Scheme)!

    Assuming that you did mean contracted out, you are in a similar situation to me - recently retired at 60 but I'm not due to get my State pension until 66.

    I've just sent off for a State pension forecast, but am working on the assumption that it will be in the region of £120 per week. I don't intend to take up any further paid employment, and so I'm seriously considering paying voluntary NI conts in order to bump up my State pension.

    Just waiting to see my actual forecast. I worked part time from 2003 until I retired earlier this year, so I may get some SP2 top up from 2002 - assuming, of course, that my reduction in salary due to my reduction in hours still classes me as 'low paid'.
    • Nick_C
    • By Nick_C 16th Oct 16, 2:16 PM
    • 2,474 Posts
    • 3,261 Thanks
    Nick_C
    • #3
    • 16th Oct 16, 2:16 PM
    • #3
    • 16th Oct 16, 2:16 PM
    You can and you should pay Class 3 NICs when you retire.

    I'm 59 and retired four years ago. Even though I was contracted out for over 30 years, my current SRP forecast is £131.45.

    The maximum possible pension for me is £155.65. So I can increase my pension by £24.20 a week by paying voluntary NICs. Each extra year of contributions increases the pension by £4.45 a week. So if I pay 6 years NICs, I will get £155.65. If I only pay 5 years though, I will get £153.70.

    Buying Class 3 contributions currently costs £733 a year.

    So by buying NICs for £3665, I will get an additional pension of £1150 a year. Probably the best investment I will ever make.

    Paying a further £733 for a sixth year to an extra £100 a year pension is less attractive.

    Hope this helps.
    • Nick_C
    • By Nick_C 16th Oct 16, 2:18 PM
    • 2,474 Posts
    • 3,261 Thanks
    Nick_C
    • #4
    • 16th Oct 16, 2:18 PM
    • #4
    • 16th Oct 16, 2:18 PM
    I've just sent off for a State pension forecast ...
    Originally posted by Silvertabby
    You can do this on line at https://www.gov.uk/check-state-pension
    • Silvertabby
    • By Silvertabby 16th Oct 16, 2:47 PM
    • 371 Posts
    • 397 Thanks
    Silvertabby
    • #5
    • 16th Oct 16, 2:47 PM
    • #5
    • 16th Oct 16, 2:47 PM
    “ I've just sent off for a State pension forecast ...
    Originally posted by Silvertabby
    You can do this on line at https://www.gov.uk/check-state-pension
    Thanks Nick. I've got over 5 years to go, so there's no rush - and I'm one of those people who like to get a bit of paper with an official heading instead of a screen print (yes, I do know that the official paper is still just an estimate!). However, I'll have a look just to see how the on-line forecast compares with the paper one.

    Gah ! Tried it but lost my rag. My passport has recently expired (I'm waiting for them to start re-issuing the proper blue ones before I renew it) so I tried using the P60 option. Although the identification process screens asked for ANY P60, it wouldn't accept nil NI (my Armed Forces pension P60) and it reckoned that the information from my County Hall P60 didn't agree with the information they hold (surprised - not!).

    Will just wait for the paper one.
    Last edited by Silvertabby; 16-10-2016 at 3:11 PM.
  • jamesd
    • #6
    • 16th Oct 16, 11:52 PM
    • #6
    • 16th Oct 16, 11:52 PM
    So far as the pay slips go they probably don't have the information on the most recent ones yet and you might find that one from four months ago has the highest chance of success, then try three or two, in spite of what the instructions say. Might work better than P60s also, depending on just how current their information is.
    • frugal90
    • By frugal90 17th Oct 16, 5:08 AM
    • 188 Posts
    • 44 Thanks
    frugal90
    • #7
    • 17th Oct 16, 5:08 AM
    • #7
    • 17th Oct 16, 5:08 AM
    thanks, hope I will be able to do that when the time comes

    frugal
    • Bootsox
    • By Bootsox 17th Oct 16, 5:49 AM
    • 142 Posts
    • 81 Thanks
    Bootsox
    • #8
    • 17th Oct 16, 5:49 AM
    • #8
    • 17th Oct 16, 5:49 AM
    ...So by buying NICs for £3665, I will get an additional pension of £1150 a year. Probably the best investment I will ever make.

    Paying a further £733 for a sixth year to an extra £100 a year pension is less attractive.

    Hope this helps.
    Originally posted by Nick_C
    Thanks for your informative reply, a couple more questions please:
    • How did you go about paying the NIC3s, e.g. was it by monthly standing order or a series of annual one offs?
    • How did you actually "get into" HMRC to set this up (did you do it by phone/e-mail/snail-mail)?

    Regards
    • xylophone
    • By xylophone 17th Oct 16, 11:07 AM
    • 19,176 Posts
    • 10,893 Thanks
    xylophone
    • #9
    • 17th Oct 16, 11:07 AM
    • #9
    • 17th Oct 16, 11:07 AM
    Now someone will know the answer to this, I hope.
    http://www.thisismoney.co.uk/money/pensions/article-3838476/Can-pay-new-state-pension-Steve-Webb-replies.html

    https://www.gov.uk/government/publications/national-insurance-application-to-pay-voluntary-national-insurance-contributions-ca5603
    • woolly_wombat
    • By woolly_wombat 17th Oct 16, 11:37 AM
    • 364 Posts
    • 222 Thanks
    woolly_wombat
    For more on how to complete form CA5603 see:

    http://forums.moneysavingexpert.com/showthread.php?p=70509349&highlight=ca5603#post705 09349
    • Nick_C
    • By Nick_C 17th Oct 16, 3:01 PM
    • 2,474 Posts
    • 3,261 Thanks
    Nick_C
    Thanks for your informative reply, a couple more questions please:
    • How did you go about paying the NIC3s, e.g. was it by monthly standing order or a series of annual one offs?
    • How did you actually "get into" HMRC to set this up (did you do it by phone/e-mail/snail-mail)?

    Regards
    Originally posted by Bootsox
    I haven't actually made any payments yet, but I have six full tax years after this one to make five years contributions, so there is no hurry.

    I wrongly thought that the only way to pay was in arrears after the tax year ended, but on a similar thread to this someone posted that you can pay by monthly direct debit (4 or 5 weeks each month).

    See

    https://www.gov.uk/pay-voluntary-class-3-national-insurance

    and

    https://www.gov.uk/government/publications/national-insurance-application-to-pay-voluntary-national-insurance-contributions-ca5603
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