National Insurance issues that may affect pension.

scorpionxedos

I retired in 1996 due to ill-health and haven't worked since. At that time I stopped paying NI contributions. I'd have about 16 years NI contributions paid in.

With all the pension news this week, the option of taking a lump sum may, for me, be a good option.

Would this lack of NI contribution since 1996 hurt my lump sum?

If so, what should I do before 2015 arrives?

Thanks guys.

xylophone

How old are you?
Why do you think that your NI contributions record affects a lump sum from a private pension?
Are you receiving an ill health pension from an occupational scheme?
Are you receiving NI credits?
When do you expect to become eligible for state pension?

jem16

scorpionxedos wrote: »

Would this lack of NI contribution since 1996 hurt my lump sum?

if you're talking about the state pension, the new pension rules are nothing to do with it.

scorpionxedos

xylophone wrote: »

How old are you?
Why do you think that your NI contributions record affects a lump sum from a private pension?
Are you receiving an ill health pension from an occupational scheme?
Are you receiving NI credits?
When do you expect to become eligible for state pension?

I'm receiving a basic retirement (occupation) pension and (for now) an ill-health occupational pension. I'm 52.

No NI credits.

I would expect to be eligible for state pension at 65, but recent media comments by the chancellor suggest that I could claim a lump sum instead at 55. Is that incorrect?

bryanb

scorpionxedos wrote: »

I would expect to be eligible for state pension at 65, but recent media comments by the chancellor suggest that I could claim a lump sum instead at 55. Is that incorrect?

No not correct.

It looks as though you need to make some NI contributions to qualify for a full state pension.

If you are 52 you will not get state pension at 65.

xylophone

The Chancellor's statements do not refer to the State pension.

With regard to state pension, see
https://www.gov.uk/new-state-pension/overview

http://www.thisismoney.co.uk/money/pensions/article-2740581/Older-workers-wait-new-flat-rate-state-pension.html

jackyann

I think that you need to get some individual advice. If you are still in your union, try them, or CAB, or a helpline run by a charity that understands your situation (maybe associated with your illness or disability).
Generally, you need a defined number of years NI contributions (or credits) to qualify for the State Pension. If you are not working (or claiming a benefit that entitles you to a credit) then you can pay voluntary contributions. Whether it is worth your while to do so needs an individual assessment; also taking account of your current & predicted state of health.

jem16

scorpionxedos wrote: »

I would expect to be eligible for state pension at 65, but recent media comments by the chancellor suggest that I could claim a lump sum instead at 55. Is that incorrect?

No it's not correct. The references to a lump sum are in relation to Defined Contribution pensions where, from April 2015, you could choose to take a lump sum instead of purchasing an annuity.

As to the state pension, it will remain as a weekly payment which is dependant on the number of NI contributions. At 16 years you are way short of the required 35 years so you will not get a full state pension. Your state pension age is likely to be age 66 and not age 65.

atush

you need to start paying voluntary nics asap or you wont be getting very much SP at all

ARe you elegible for any benefits that might entitle you to nics?

scorpionxedos

Not aware of any benefits re the nics.

What would be the best strategy then to top-up my nics?

I'm sure I read a thread a while back which suggested you would need to pay "the difference" - ie the whole amount from 1996-2014, but just top-up.

Sorry to be vague but it was something I read a long while back and I don't read a lot about NI due to me retiring so early.

Appreciating all the help guys, thank you.

mgdavid

scorpionxedos wrote: »

Not aware of any benefits re the nics..........

you may be not aware, but have you checked?
https://www.gov.uk/national-insurance-credits/eligibility