MSE News: Flat-rate state pension could be £155 a week

zagfles

bilbo51 wrote: »

How? The reason I ask is that the green paper says that 30 years contributions will be required to get the full pension. So no change there. Other than maybe (thinking as I'm typing) that for a woman who has, say, 20 years contributions, 20/30 *£140 is bigger than 20/30*£97...?

Exactly. The second state pension part is higher if your have 49 years of earnings than if you have 30, under the new scheme it'd be the same.

descartesmum

I turned 60 last year but didn't start getting my state pension until January of this year. The only thing that upset me about that was I didn't receive the £250 winter fuel allowance last year and now I've been told it's going to be £200 this year. This past winter the only heat I had was 1 electric radiator that I had in my livingroom to keep me warm, I couldn't have used the gas central heating.

Then I heard that new pensioners would get the £140 - 155 in a few years and really got angry but had a hard think and thought okay, by the time 2015-16 comes around we who already get the £132 might in raises be at the £140 mark. We get an almost £5 raise next week so you figure it out if we continue to get that extra £5 a year.

Saetana

Okay, now I'm 41, not currently working as my husband needs a certain amount of care and is on disability benefits, I opted out of SERPS back when the option was first offered, that was the advice they were giving to us young adults back then. I have several thousand pounds in my opted-out private pension (SERPS only, I never added to it), so far as I understand it this has now been frozen and will simply continue to gain dividends/interest/whatever (I know almost nothing about pensions) and I can take that pension in the same way as I would have done without the new pension system, half in a lump sum and half as a pension (or all pension but I don't see the point in that when it is such a small amount of money). I've recently had communication from my private pension provider (as has my husband from his) and it seems we fall into a fairly narrow age range (its only 8-10 years) that are advised to just let our pensions continue regardless of SERPS coming to an end, we would have done this anyway due to the fairly small amounts involved as we can take some of the money several years earlier than state pension age.

My question is, does this new pension system affect the money in our private pensions that has come purely from contracting out of SERPS?

carrotmuseum

Anyhone know what happens to those of us who paid graduated NI contributions in the 1970's, so that they would have paid in more to receive a higher pension?

WillowCat wrote: »

Or those 'lucky' enough to reach retiring age after the date of introduction, who find their hard-earned state pension to be less than they had expected and planned for.

As I understand it the current system (assuming full contribution record) is State pension (£97 ish) PLUS serps/gmp PLUS s2p/contracted out pension.

The new system suggested appears to be £150 ish MINUS serps/gmp MINUS s2p/Contracted out pension.

In addition, particularly for the females, the pension age will be much greater than for our parents, and not all of us will live for longer.

I struggle to see how a formerly full time employed current pensioner could have managed to avoid accruing SERPS/S2P or contracted out pension and therefore only have the standard pension. The 30% increase, I think, will kick in for the self employed (who have enjoyed, in most cases, lower NI contributions than employees) and those who were on benefits as adults, or with home responsibilities and therefore had credited (free!) NI contributions.

roddydogs

bilbo51 wrote: »

How? The reason I ask is that the green paper says that 30 years contributions will be required to get the full pension. So no change there. Other than maybe (thinking as I'm typing) that for a woman who has, say, 20 years contributions, 20/30 *£140 is bigger than 20/30*£97...?

So a women with only 20 yrs stamps WILL lose out compared with her hubby whose got 30 yrs, how is that "Not losing out"?

bilbo51

carrotmuseum wrote: »

Anyhone know what happens to those of us who paid graduated NI contributions in the 1970's, so that they would have paid in more to receive a higher pension?

Graduated pension is considered in the same light as S2P and SERPS. All three are lumped together as "additional State Pension" (p.27 of Green Paper).

Elizabeth_Kelly

Hi All,

I have a question regarding the changes to the pension the government is bringing in. There was a lot of talk about being given early access to your pension pot say for instance if you hit hard times. What happened to this idea. Has it been dumbed just like many other grand ideas.

Also if you were given early access to your pension pot wouldn't this mean you would not be allowed to claim any benefits say if you lost your job because the pension would under this new rule be classified as your saving. Wasn't this new proposed change just a way to cut benefits payments.

What if any guarantee is there this rule wont be brought in at a later date or some other silly rules. Have lost all trust in this pension nonsense. Just read some of the stories above.

Liz

bilbo51

roddydogs wrote: »

So a women with only 20 yrs stamps WILL lose out compared with her hubby whose got 30 yrs, how is that "Not losing out"?

I bet you can't find any instance of a government minister saying that under the new proposals "women will not lose out" or similar.

WillowCat

Saetana wrote: »

I opted out of SERPS back when the option was first offered, that was the advice they were giving to us young adults back then. I have several thousand pounds in my opted-out private pension (SERPS only, I never added to it).
.........

My question is, does this new pension system affect the money in our private pensions that has come purely from contracting out of SERPS?

As far as I can see, the proposed pension would not affect your SERPS private pension, however you would not get the full flat rate pension as they would deduct a sum from it, equivalent to what your SERPS pension would have been if you had not opted out.

So, say your notional SERPS entitlement is £20 per week, you would receive from the government £140 minus £20 = £120 per week, and you convert your contracted out pension into an annuity, which hopefully would deliver the other £20.

bilbo51

WillowCat wrote: »

So, say your notional SERPS entitlement is £20 per week, you would receive from the government £140 minus £20 = £120 per week, and you convert your contracted out pension into an annuity, which hopefully would deliver the other £20.

Which could lead to the possibility of your getting less than the current £97 state pension if your SERPS/S2P clawback (aka offset) is greater than ~£43... (£140- £43 = £97) even though you've paid 30 years contributions I think.