Opt out

burkey365

looking for some advice my aunt says that her state pension is £16 per week less than it should be but says the only thing she can think of why is that her husband who is now deceased was self employed for a short time and mentioned something about opt out, does anybody know what this could be, any help would be appreciated thanks

hugheskevi

looking for some advice my aunt says that her state pension is £16 per week less than it should be

What should it be? And how was the figure it should be calculated by your aunt?

the only thing she can think of why is that her husband who is now deceased was self employed for a short time and mentioned something about opt out

Whilst self-employed, her husband would not have accrued any additional pension. That shouldn't have any particular relevance here, but without more fact about what exactly the issue is, can't say for certain. More likely, the opt-out reference was in relation to contracting-out of additional pension at some point, but again, that probably isn't relevant but depends on why your aunt thinks she is not getting enough.

does anybody know what this could be

Without facts, this is mere speculation.

My guess is that your aunt expected to receive the same amount of State Pension as her husband received.

Her husband's State Pension probably included some SERPS, and she has inherited it, but inheritance is less than 100% (see this page for explanation).

For example, let's say her husband received £140 per week, comprising £102 Basic State Pension and £38 SERPS. If she inherited 60% of that £38 and the full Basic State Pension, she would get £125 per week.

So if she was expecting £140 per week, she would think she was getting £15 per week less than she should be.

dunstonh

"opt out" is what you do when you choose not join an occupational pension. I suspect you mean "contract out" which is when you contract out of SERPS or the State second pension.

If you contract out, then the personal pension provider (or occupational pension scheme) pays the benefits that would have been paid by the state. So, its not lost. Just diverted to another payer.

Also, the self employed do not qualify for SERPS/S2P. They only qualify for the basic state pension.