Flat Rate Pension one year earlier - April 2016

geelamch

Hi ,both retire 2017.pension says says we both have full qualificationas we have worked ,me 46 years ,wife 41 both full time throughout.

gadgetmind

geelamch wrote: »

Hi ,both retire 2017.pension says says we both have full qualificationas we have worked ,me 46 years ,wife 41 both full time throughout.

So you'll come under the new flat rate scheme and will get full basic plus and unknown additional amount in SERPs/S2P. How much this latter number is you won't know without state pension forecasts/statements.

These statements are free so I get them every year for myself and spouse just to check that everything is ticking along nicely.

jem16

kuepper wrote: »

Re your Q, I'm ashamed to say I have no idea. Only ever been in one pension scheme as far as I know, I was in a local government pension scheme for about 23 years, but don't know if it was 'contracted out' or not.

Yes the LGPS is a contracted out scheme.

jamesd

geelamch wrote: »

In simple terms does this mean that in future years I will receive a flat rate of 144 irrespective of personal pension etc,and will wife receive same,we have both worked all our lives and retire in a few years time

Both of you will probably get more than £144 if you weren't mostly in contracted out pension schemes. The Additional State Pension added to the Basic State Pension would take even someone working most of their life on minimum wage to a number more like £200 a week than £144 a week and transitional protection will keep you getting that higher level, not being cut back to £144.

You should both ask for a state pension statement to see what you've accumulated so far. Not just in years, but in amounts of additional and other non-basic state pension payments.

If you've done a lot of work in contracted out pensions, like most government pensions and most final salary private pensions, you'll have a contracted out deduction applied tot eh numbers and that might drop you to below £144. Depends on just how many years you were contracted out. But the benefits from being in a contracted out pension scheme should still be more than you'd lose from the deduction, so it's not something to be upset about.

golfing12

HI, I have one simple question, my date of birth is 12 April 1951, would I be eligible for the new flat rate pension ?

jem16

golfing12 wrote: »

HI, I have one simple question, my date of birth is 12 April 1951, would I be eligible for the new flat rate pension ?

Yes unless you are female in which case no.

zagfles

jamesd wrote: »

Both of you will probably get more than £144 if you weren't mostly in contracted out pension schemes. The Additional State Pension added to the Basic State Pension would take even someone working most of their life on minimum wage to a number more like £200 a week than £144 a week and transitional protection will keep you getting that higher level, not being cut back to £144

This isn't true, because prior to 2002 people on low incomes would have got very little SERPS. Someone who spent all their working lives on around £12k in todays terms would have only built up about 50p per year in SERPS prior to 2002, then about £1.40 from 2002 till last year then £1.70. So probably about £40 if they are due to retire in 2017, total £147, so maybe just above the single tier amount.

jamesd

Thanks, true about the lower accrual rate form SERPS. Seems likely that they weren't both on minimum wage and are well above £144, though.

xylophone

Re your Q, I'm ashamed to say I have no idea. Only ever been in one pension scheme as far as I know, I was in a local government pension scheme for about 23 years, but don't know if it was 'contracted out' or not.

See http://www.yourpension.org.uk/Files/Files/In%20The%20Scheme/5.%20GMPGuide240211.pdf

Obtain a pension statement https://www.gov.uk/state-pension-statement

oliver1950

This change to a flat rate system is divisive and unfair.

Assume 2 people, one retires a couple of months before the deadline and one just after.

The one who retires before will get £107 the other £144. Annually this is £5564 v £7488
a £1924 difference. Assuming 20% or 40% taxpayers ( who don't qualify for any pension credit!) . This represents an after tax impact of £1539 or £1154. That's a lot of money. Assuming one survives retirement even by a modest 10 years that's between £11500 and £15000 lost. THIS is the most unfair and divisive change I have ever seen. Sadly this government seems to act without thought on too many issues. Perhaps we can agree to start an e-petition to either scrap the new pan or pay it to all pensioners on the basis of the number of years . I have 40..but it will not give me a larger pension that someone with 35 who happens to retire after the new system is implemented. AND remember, pensions will get inflation uplifts, so the smaller pensions will lose out twice!:mad: