MSE News: Pensioners to be given £25 a week state pension boost

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  • edited 3 April 2014 at 5:31PM
    OblivionOblivion Forumite
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    edited 3 April 2014 at 5:31PM
    zagfles wrote: »
    So you get no SERPS/S2P (or equivalent benefits from a contracted out scheme)? Were you self-employed?

    There's a lot of people who will be far worse off under the new scheme. Under current rules today, someone on NMW for they working life would get about £190 in state pension (basic+S2P). Under the new rules they'll get about £144.


    Not my problem ... I simply want to see the government give everybody the same BASIC rate appropriate to their qualifying years, a level playing field for all not dictated by your date of birth ... any entitlement beyond that is down to personal circumstances.
    ... Dave
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  • Jaycee_DoveJaycee_Dove Forumite
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    Though Zagfles makes a fair point that there will be losers under the new system also.


    A cliff edge works two ways - and that is the problem of this new flat rate scheme being introduced on one single date with people born perhaps seconds apart (quite literally) being treated entirely differently.


    Indeed you might be new or old system dependent on the whim of a nurse at your birth who decreed it was before or after midnight!


    This is what you get without any phasing in and out of such a radical change. I think a fairer way could have been created.
  • OblivionOblivion Forumite
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    Though Zagfles makes a fair point that there will be losers under the new system also.


    A cliff edge works two ways - and that is the problem of this new flat rate scheme being introduced on one single date with people born perhaps seconds apart (quite literally) being treated entirely differently.


    Indeed you might be new or old system dependent on the whim of a nurse at your birth who decreed it was before or after midnight!


    This is what you get without any phasing in and out of such a radical change. I think a fairer way could have been created.


    I hope that Martin Lewis will be taking note of this and using his influence to campaign for a fairer transition.
    ... Dave
    Happily retired and enjoying my 14th year of leisure
    I am cleverly disguised as a responsible adult.
    Bring me sunshine in your smile
  • edited 3 April 2014 at 6:44PM
    zagfleszagfles Forumite
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    edited 3 April 2014 at 6:44PM
    Oblivion wrote: »
    Not my problem ... I simply want to see the government give everybody the same BASIC rate appropriate to their qualifying years, a level playing field for all not dictated by your date of birth ... any entitlement beyond that is down to personal circumstances.
    The new single tier pension replaces the basic state pension and SERPS/S2P. You do realise that, don't you? Someone who reaches state pension age after the change who has the full basic and over about £35pw SERPS will get the same as if they reached state pension age before the change.

    There's so much ignorant ranting about this - there are cliff-edge losers but it's mainly the self-employed. Anyone employed for 47 years will have a lot of SERPS/S2P or the equivalent in contracted out benefits, so there is no cliff-edge at all. They'll likely be better off on the old system.
  • zagfleszagfles Forumite
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    Though Zagfles makes a fair point that there will be losers under the new system also.


    A cliff edge works two ways - and that is the problem of this new flat rate scheme being introduced on one single date with people born perhaps seconds apart (quite literally) being treated entirely differently.


    Indeed you might be new or old system dependent on the whim of a nurse at your birth who decreed it was before or after midnight!


    This is what you get without any phasing in and out of such a radical change. I think a fairer way could have been created.
    It is being phased in in that those who are better off on the old system will get what the old system calculation gives them. For most people the old system will give them more, main exception being the self-employed who never got any SERPS/S2P.
  • ConsumeristConsumerist Forumite
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    Welshpat wrote: »
    An ISA seems to be a much better option. At least I would have control over my own money and it's not taxed.
    . . . and if you pop off unexpectedly early, your family will get what's left - not HM Treasury.
    >:)Warning: In the kingdom of the blind, the one-eyed man is king.
  • Jaycee_DoveJaycee_Dove Forumite
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    zagfles wrote: »
    It is being phased in in that those who are better off on the old system will get what the old system calculation gives them. For most people the old system will give them more, main exception being the self-employed who never got any SERPS/S2P.



    Yes, I am the Titanic in the perfect storm for this new system.


    Self employed woman but on pretty low income because I had to tail back my work substantially to become a carer for the past decade to my aging mum after a massive stroke left her paralysed.


    Yet I paid 42 years stamps nonetheless (7 more than required as it turns out). And, knowing I had no S2P I had saved into Tessas and ISAs in order to have something. This was my mistake. I would have been better off not bothering. The system would have protected me - and it has betrayed all those who tried to save but were not so well paid as to make those savings considerable.


    As I had savings and was still working as much as I could whilst being a full time carer I only qualified for Carer's Allowance a year or two before I reached SPA and at that point I lost it, of course as you cannot get Carer's Allowance and defer your pension - because if you do the government effectively steals the difference between your Carer's Allowance (£60 pw) and your pension (say £100) - so £40 pw donated to the chancellor for being a carer!


    I had to defer my pension because it was barely above the SP of £110 AND because having done the right thing and made savings meant that I did not qualify for Pension Credit. Even though those savings had been destroyed by a two pronged attack of tiny interest and having to use them partly for day to day living prior to reaching SPA whenever bills came up and my income from working was not by then sufficient to cover them.


    Like I say, had I saved nothing then I would have gotten loads of help and the equivalent of the new flat rate pension. Because I thought ahead and tried I was basically left high and dry by the rules.


    Of course, at the same time my age for receiving pension was pushed back because I was a woman born between 1950 and 1953. I got caught every way in this trap.


    Even now I am doing the best I can for myself by deferring my pension (in other words having almost zero income to live on but for the last of my savings laughably gathered over the decades as an equivalent of a second pension). If I can manage to do this until some point next year I will just about bump myself up to the level of the new flat rate - at which point I suspect all my savings will be gone and I could have got pension credit anyway!


    I have a friend born not long after me (a year or so), also self employed and who has not had to touch similar savings than I had built up because they have not been a carer. They qualify for the new flat rate, despite having several less years NIC payments than I do and around £100,000 savings I will not have.


    I am having to live on nothing to try to achieve parity thanks to little more than the calendar and circumstance.


    Am I bitter? No, its just rotten luck. But it reveals the inequity that exists through no fault of those caught up. And when I get told that I can 'buy' the missing £25 pw to plug the gap if I hand over £23,000, I do get pretty annoyed, as it really just feels like an insult.


    Still, as my deferral shows, there are ways around this new system if you can make them work for you as I am trying to do.
  • zagfleszagfles Forumite
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    Yes, I am the Titanic in the perfect storm for this new system.
    You really are! Yes, in your case you have an absolute right to rant, I would be!

    But we've seen it here before - in most cases those ranting about the new system are only doing so because they don't understand it, they think they're losing out when they're not.
  • scotsbobscotsbob Forumite
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    Anyone increasing their pension in this way may find it is then taken into account if any state benefits are claimed in the future.

    My experience is that it is best to keep as much as possible off the radar. You never know when some government dept. is going to try to snatch it
  • kidmugsykidmugsy Forumite
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    Some of these complaints are not really about pensions, they are really about the structure of the post-1945 welfare state. It would have been better to modify the previous welfare state in line with the Beveridge proposals, but that's all spilt milk.
    Free the dunston one next time too.
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