Pension Boosting article discussion

jancee_2

dulcimer wrote: »

I retired in 1999 and only had some 30 years stamps so my pension is even now only £54.00 is there any way I can buy back years to boost my pension

You won't qualify even under the new rules to buy extra years. Have you checked whether you are entitled to Pension Credit?

jancee_2

dejavou wrote: »

I deferred my pension in 2006 as I have continued to work, but I've rung the Pension Service on a couple of occasions now to get a forecast of what I will get if I decide to draw it this year, both times I got different opinions, but nothing concrete as "the systems didn't seem to be working" I was promised a forecast in writing both times ..... still waiting, so it seems even getting something that simple, isn't that simple!!!!!!!!!

For a quote on a deferred state pension ring the claims line [even if you just want a calculation] on 0800 731 7898.

joannie

Hi,

To any ladies out there who are divorced and thinking of getting re married, think twice. I was going to get re married but am entitled to a full state pension from my ex's contributions. I do not have enough of my own and if I get re married I will only get 60% pension based on my new husband's contributions. Shan't be getting re married now, will just live together.

So much for family values!!

SnowMan

I think the concept of the Pensions Calculator is a good idea but from a quick look have some comments to make (to keep it simple these comments are based on post 6/4/2010 SPAs)

• It would be much easier to enter your date of birth than the “when do or did you retire” input. You are relying on someone clicking on the question mark, using the SPA calculator and then re-entering the SPA date in the calculator. It would be simple programming to calculate the SPA from the date of birth and to show the answer with the other information.

• There is not enough warning of the major assumption being made that the person will have no FUTURE qualifying years. For example a 48 year old with 28 qualifying years to date is given the cost of buying up 2 years of extra contributions. Surely there is every chance that the individual will gain two further qualifying years through NI some time in the future. In that case buying extra years now is pretty much paying money for nothing. Yet the person using the calculator won’t realise that. A warning should be given whenever past qualifying years + potential future qualifying years + years you intend to buy exceeds 30.

• I had a think about basing the calculation on the current rate of basic state pension. I think the effective assumption being made is that the return on the money you pay now to buy the credits if you had otherwise invested it is equal to the rate at which basic state pension increases each year. As the earnings link for BSP returns in 2012 (?) it may be OKish. However the unknown in the para above of possible future qualifying years based on NI is still a problem.

RICH2002

My wife once a year gets letters from the dept of work and pensions saying she might need to top up her pension contributions.
She previously worked full time for 12 years paying full stamp, took 10 years out looking after kids getting child benefit and will continue to get child benefit for another 5 years minimum, worked part time during this period but did not earn enough to pay NI. She has just started a new job and is now earning above the threshold to pay NI. She is 48 now so has another 18 years possibly to earn NI stamps.
Question ?????????????
When i contacted the dept of work&pensions they could not give me a definitive answer as to whether she needed/would be better off to top up her contributions. They could not even say how many years her HRP would cover her for.

I am of the opinion(after reseach) that she would not need to top up her contributions currently, but all depends on her future contributions.
I assume she should be entitled to minimum 16 years HRP from child benefit (had 2 kids 2 years apart). 12 years full NI contrbutions previously banked.
So she only needs minimum 2 full years NI contributions to take her to the 30 years threshold over the next 18 years.
Would my assumptions be correct ???????????

SnowMan

To reply Rich2002:

P23 of NP46 which can be downloaded from

http://www.pensions.gov.uk/resourcecentre/employers.asp

explains the current rules for HRP and when credits are given (or how they are claimed in some circumstances).

However importantly HRP is changing in 2010 see

http://www.pensionsadvisoryservice.org.uk/pension_reforms/State_Pensions/index.asp

Up to 22 years of HRP are going to be converted to normal credits from then

I suspect that your wife after the conversion and future credits through working will reach the 30 years of credits required for a full state pension without difficulty and will come to the conclusion that there is no need to pay voluntary contributions at this point. But you need to monitor the situation.

In summary I agree with your conclusions.

And if you haven't already done so find out exactly what credits she has (and how many HRP credits in as well) currently.

RICH2002

Cheers Snowman

jancee_2

joannie wrote: »

Hi,

To any ladies out there who are divorced and thinking of getting re married, think twice. I was going to get re married but am entitled to a full state pension from my ex's contributions. I do not have enough of my own and if I get re married I will only get 60% pension based on my new husband's contributions. Shan't be getting re married now, will just live together.

So much for family values!!

You can claim on ex's contributions and remarry the day after pension age is reached.

worker800

As advised on this site I have just been on to the Inland Revenue who advised me that I was short on 3 years NIC and to pay them I must contact Pension Forecasts on 0845 3000168. They took details and said I can't pay until I have received their Pension Forecast which will take about 10 days to arrive. I explained that would probably take me over the 5 April 2009 and I would have to pay at the higher rate. They agreed but there was nothing they could do about it. I said I was willing to pay here and now but no I had to wait for their Forecast to arrive. This is so wrong, what can be done, I'm at a loss. This is going to cost me an extra £1000!!!! I'm so angry I don't know what to do and writing this hasn't made me feel any better. Any suggestions on how to beat this system?

jancee_2

worker800 wrote: »

As advised on this site I have just been on to the Inland Revenue who advised me that I was short on 3 years NIC and to pay them I must contact Pension Forecasts on 0845 3000168. They took details and said I can't pay until I have received their Pension Forecast which will take about 10 days to arrive. I explained that would probably take me over the 5 April 2009 and I would have to pay at the higher rate. They agreed but there was nothing they could do about it. I said I was willing to pay here and now but no I had to wait for their Forecast to arrive. This is so wrong, what can be done, I'm at a loss. This is going to cost me an extra £1000!!!! I'm so angry I don't know what to do and writing this hasn't made me feel any better. Any suggestions on how to beat this system?

If you are certain you have no contributions in a particular year since 1996/7 then you can pay for the full year by sending a cheque to HMRC at Benton Park View, Newcastle upon Tyne, NE98 1ZZ. NI number on the back and the years you want to pay for. Costs for each year are in Martin's new calculator.