Help for friend receiving only 66p pension

Don'tskipit

Hi, my friend told me today that she was receiving only 66p a week pension.

This can't be right surely. She was 60 in October last year,
She's married - husband is 63. She has worked all her life-for employers , paid full 'stamp' till she married in the late 1960's then paid reduced married woman contributions(for I don't how many years) then when she went into self employment paid full contributions.

66p a week?!!! Sounds mad!
It's got to be completely wrong. Any advice would be welcome. Thanks

seven-day-weekend

Married women's stamp does not count towards Pension, or Home Responsibilities Protection. So the years she was paying that will count for nothing.

However, her self-employed stamp should have counted, but I think she needs to pay for a minimum of ten years to get any Pension.

She will be able to claim 60% Pension based omn her husband's contributions when he reaches State Retirement age.

chesky369

Nope, sounds right to me and you can be absolutely sure that, if it's as low as this, the pension service will have double and triple checked their sums, simply because people won't believe it. The terrible thing is that women probably didn't realise just what paying the married woman's stamp would do to them later in life.
What about SERPS (the pay as you earn pension bit)? Also, when her husband gets to 65, she will probably get an increase, based on his contributions.

Don'tskipit

But .... 66p a week is an insult.
She and her husband have worked all their lives, never been on any benefits.
Still can't understand where the pension people get 66pence a week from.

seven-day-weekend

She has almost ceertainly not paid enough NI to get any State Pension (as the married women's stamp didn't build it up, no matter how long you paid it for) and the 66p may be Graduated pension, which was a little addition on your pension up until the 70s and gained you a few extra pence.

I am amazed at how many women seem not to know that paying the married women's stamp would get them NO pension and are finding out now the hard way.

As I say, she will be able to claim a 60% Pension when her husband retires (assuming he has a full NI record).

EdInvestor

It sounds as though she has less than 10 years' NI and is thus not entitled to any state pension at all in her own right. She will be able to get one worth 60% of her husband's when he retires in 2 years' time.

The 66p may be a bit of Graduated Pension, a very small extra pension which was the precursor to SERPS in the 60s/70s.

If she rings up the Pension Service they will explain their calculations.

amethystcash

Ho do you know whether you are paying the reduced married woman's contribution or the full contribution?

seven-day-weekend

The choice to pay Married Women's Contribution finished in 1977, so if you are younger than about 50 you won't be paying it.

Most of those who paid it are either retired or coming up to retirement age (like me, but thank goodness I paid the full stamp and will get a full Pension).

If you are older and could be paying it, then check with your wages office, but it's going to be a bit late now to do very much about your pension.......:(


http://www.hmrc.gov.uk/faqs/women_reduced_rate.htm

Who is entitled to pay reduced rate NICs?

A woman who was married on or before 6 April 1977 could choose to pay a reduced rate of Class 1 NICs or if she was self employed, not to pay Class 2 NICs. This choice had to be made on an official form before 12 May 1977. No-one who married after 6 April 1977 could chose to pay the reduced rate, and no woman was entitled to make an election after 11 May 1977.
A certificate of election would h
Who is entitled to pay reduced rate NICs?

A woman who was married on or before 6 April 1977 could choose to pay a reduced rate of Class 1 NICs or if she was self employed, not to pay Class 2 NICs. This choice had to be made on an official form before 12 May 1977. No-one who married after 6 April 1977 could chose to pay the reduced rate, and no woman was entitled to make an election after 11 May 1977.
A certificate of election would have been issued which the woman would have given to her employer to show that reduced rate NICs should be deducted from her earnings or, if self employed, she would have retained herself to prove that she was excepted from liability for Class 2 NICsave been issued which the woman would have given to her employer to show that reduced rate NICs should be deducted from her earnings or, if self employed, she would have retained herself to prove that she was excepted from liability for Class 2 NICs

The MWC really was a con and it seems many women were not aware (like the OP's friend) that they would get no Pension if thery chose this option. Thankfully my employers fully explained my options to me and although I fdid pay MWC for a year, I soon realised (even at the age of 21) what a no-brainer it was and switched to the full NI contribution.

Not everyone had such honest employers, it seems.

Also, I suppose we must remember that State Pension depends on Contributions, so I suppose if you pay none in you get none back. I just don't think this was made very clear at the time to many women.

Thankfully no-one can make this choice now.

margaretclare

I completely agree with 7DWE's assertion that this scheme was a 'con'. However, it must be remembered that assumptions were very different when the scheme was set up, in the late 1940s. It was widely assumed - in officialdom and elsewhere - that a married woman did not 'need' to work, should not work, because she had a husband to support her while she stayed at home on what Beveridge called 'other duties' by which he meant raising the next generation and 'replenishing the race' after WW11. This 'support' was intended to extend as far as the retirement years - having been used to living on husband's financial support she would continue to live on it when he retired.

We watched a 'Dispatches' programme on Channel 4 last evening, about the plight of older workers who can't afford to retire. In contrast to many people, DH and I do all right, but only because we each have an income and we combine our resources. If I had continued to pay the 'married women's stamp' all those years ago I'd have had a 100% retirement pension after my first husband's death, but this would have gone down to 60% when I remarried and had to claim against DH's contributions. Ironically enough, we think that DH's ex-wife is claiming 100% against his contributions because she's divorced from him.

Robert_Sterling_3

I think the idea of opting for a married woman's stamp was that the husband was the bread winner.

seven-day-weekend

Yes, Robert Sterling, it was, but there was always the choice to pay full stamp if you were working - why turn down a chance to get 100% at your own retirement age rather than 60% at his?

My husband is only a year older than me; I can get my full State Pension plus a bit of SERPS next January at 60. If I had only paid the MWC I'd have had to have waited until 2014 when he is 65, and then got 60%.

To anyone who understood the choice it was a no-brainer.

I didn't pay NI for about 14 years (either a SAHM, at Uni or in a low-paid job because of family committments), and my husband was the breadwinner, but because I had paid full stamp and was in receipt of Child Benefit ; those years were credited to me as Home Responsibilities Protection. They would not have been if I'd paid MWC.

So in January 2010 I have a Pension made up of 24 years paid full contributions, 13 years HRP and 2 years Voluntary Contributions.