Pricate pension projection seems way too high

Loughton_Monkey

desparateforadvice wrote: »

So you think the additional £3000 aged 65 might be an adjusted SERPS? ie they might have taken the estimated £2500 pension aged 60 off the estimated state pension of £5500, so giving the estimated projection of an additional pension age 65 of £3000? I f so thats really misleading because in their quote Ive assumed all along that the 2 phases of pension have been from my own pension pot and not inclusive of the state pension. They wont explain to me what the £3000 is. Thats another reason why Im so confused. Any thoughts??

It strikes me that you have a pension which includes a "Guaranteed Minimum Pension". Also, the 'normal' retirement age for the scheme was less than 65.

I have an old one just like this. It defines an exact amount I will get at State Pension Age (65). But the 'normal retirement date' for the company (and their pension scheme) was 62. So there is a specific pension at 62, which is significantly lower than at age 65, but in my case there is a 'temporary allowance' until age 65 to make it come a bit nearer.

desparateforadvice

Loughton_Monkey wrote: »

It strikes me that you have a pension which includes a "Guaranteed Minimum Pension". Also, the 'normal' retirement age for the scheme was less than 65.

I have an old one just like this. It defines an exact amount I will get at State Pension Age (65). But the 'normal retirement date' for the company (and their pension scheme) was 62. So there is a specific pension at 62, which is significantly lower than at age 65, but in my case there is a 'temporary allowance' until age 65 to make it come a bit nearer.

I tried to find more out today but couldnt really understand what they said. Its similar to what your are saying. The scheme was contracted out of the state pension (SERPS?). They seem to say the payment at age 60 is guaranteed but the additional sum age 65 isnt guaranteed. they also seem to say that the 8 years I was paying into the scheme means that that is 8 years non payment into the state pension and therefore I wont get a full state pension age 65. It will be reduced by 8 years. But I checked this with my curent provider and they hadnt heard of such a thing as a reduced state pension as a result of paying in to a contracted out scheme, so Im completely confused. can you help???

Ginger_Red

desparateforadvice wrote: »

they also seem to say that the 8 years I was paying into the scheme means that that is 8 years non payment into the state pension and therefore I wont get a full state pension age 65. It will be reduced by 8 years. But I checked this with my curent provider and they hadnt heard of such a thing as a reduced state pension as a result of paying in to a contracted out scheme, so Im completely confused. can you help???

I'm no expert in this area, but I think you're confusing the State Pension and the State Second Pension/SERPS. You presumably contracted out of SERPS for 8 years (as many people did). You will get a reduced S2P because you didn't pay into it for 8 years, but this money will have been invested into your own pension scheme.

Your standard State Pension will be unaffected, and as long as you've paid the full allocation of NI contributions, you'll still get the full State Pension.

I think you really need to get clarification from your provider in writing, or even ask a friend who is up in these things to be with you when you phone them, because it isn't straightforward if you're not used to the terminology.

desparateforadvice

Ginger_Red wrote: »

I'm no expert in this area, but I think you're confusing the State Pension and the State Second Pension/SERPS. You presumably contracted out of SERPS for 8 years (as many people did). You will get a reduced S2P because you didn't pay into it for 8 years, but this money will have been invested into your own pension scheme.

Your standard State Pension will be unaffected, and as long as you've paid the full allocation of NI contributions, you'll still get the full State Pension.

I think you really need to get clarification from your provider in writing, or even ask a friend who is up in these things to be with you when you phone them, because it isn't straightforward if you're not used to the terminology.

Yes I think you are right Im getting confused between first and second pension. I had no idea there were 2 state pensions and now I have an awareness, I have no idea why there are two pensions!!! Why do we make things so complicated when it comes out to assessing pensions? The only thing I do know is that Im entitled to the £97/week state pension - pension number one

dunstonh

I have no idea why there are two pensions!!! Why do we make things so complicated when it comes out to assessing pensions?

The state second pension is based on class 1 NI contributions. Its an earnings related scheme which rewards those that are employed. (but not self employed by then SE pay less NI with the view they will prefer to look after themselves).