State Second Pension - in or out?

helen_l_winter

I am currently organising myself a pension through Cavandish (as recommended by Martin). What is the State Second Pension and what are the advantages/disadvantages of contracting out of it? If I contract out is it forever or can you change your mind after time?

HELP!!

dunstonh

(as recommended by Martin).

It is not a recommendation. Its a suggestion if you know what you doing, which providers to pick and what portfolio is suitable for you.

What is the State Second Pension and what are the advantages/disadvantages of contracting out of it?

The second state pension is a second state pension based on national insurance contributions and status of your employment (i.e. self employed dont get it). You can contract out of S2P if you think the benefits of contracting out, your NI contributions and investment portfolio are suited to it. If not, you can remain contracted in. There is a Serps/S2P sticky at the top of this forum.

If I was to put a rough guess on these things, with those that are eligible to contract out, about three quarters should remain contracted in with the rest contracted out.

If I contract out is it forever or can you change your mind after time?

You can contract in or out on a yearly basis if desired. However, there is a cut off as to when you can contract in/out for the following year. Which is just about any day now with most providers.