State Pension in 5 years time and NI

GunJack

the second one of these I found, but it wasn't much help, the first one with the worked example does help, but it leads to more questions.... so, I'll get the basic SP currently 113p.w. if I've read it correctly as I'll have 31 yrs NI by 2016, with no deductions from that due to being in CS and company schemes?

OR....can I still lose out from the basic 113 by having been permanently contracted out?

xylophone

But I think contracting out was stopped a few years back,

Not for DB Schemes. http://www.which.co.uk/money/retirement/guides/contracting-out-of-state-second-pension-s2p/what-contracting-out-means/

A person who was contracted out doesn't get the earnings-related part for those years from the state but does get the fixed part.

Not exactly - somebody who was contracted out could have been entitled to some S2P

http://en.wikipedia.org/wiki/State_Second_Pension

" S2P gives all employees earning up to £32,592 a year (in 2011/12) a larger pension than SERPS, regardless of whether they are "contracted out" or not - with most help going to those in the '"lowest"' earnings (up to £14,400 a year in 2011/12) - known as the "LET" or '"Low Earnings Threshold"'.

the second one of these I found, but it wasn't much help, the first one with the worked example does help, but it leads to more questions.... so, I'll get the basic SP currently 113p.w. if I've read it correctly as I'll have 31 yrs NI by 2016, with no deductions from that due to being in CS and company schemes?

Does this make it clearer (for 2017 read 2016) http://www.unitetheunion.org/uploaded/documents/Implications%20of%20the%20End%20of%20Contracting%20Out%20201311-13373.pdf

atush

AS far as I can see from recent reading, your foundation amt will be the full basic or 113, as you already have 34 of 30 years needed at present?

Why not ask them what your foundation amount will be? It should not change from today if you aren't working? If you have built up a full basic SP before the change, you should get full basic after?

mgdavid

GunJack wrote: »

..and this is the part that's clear as mud...

so, if i work for 35 years (all contracted out) will be eligible for 113, 148, or something else as my state pension?

you also need to consider the possibility that in another 20 years the SP could well start to be means-tested; with a generous public sector pension and also a private sector DB pension I imagine you could be in the firing line

GunJack

thanks for the links guys, it's much clearer now... I think half the problem is in the terminology used, which serves to slightly confuse us poor not-in-the-business "normal" people

so, I'll be entitled to basic (currently 113) SP, with the upgrade of 20yrs-worth of uplift (at around 4pw) which should take me to the max 148, along with my final salary schemes. That makes sense now..

...but I don't relish the idea of means-testing the basic SP after I've (and sooo many others) will have 40-50 yrs of contributions new starters maybe, but the govt trying to shut the gate after the horse has bolted is plain wrong.....

kidmugsy

GunJack wrote: »

...but I don't relish the idea of means-testing the basic SP after I've (and sooo many others) will have 40-50 yrs of contributions.

It's been explained to you that there is no means testing. What are you on about?

bigchipper

atush wrote: »

become a self employed house sitter or dog walker and pay class 2 for one year?

To qualify as self employed and pay contributions would you actually need to have carried out some of this "work" in a paid capacity, or can you still register as self employed and pay the class 2 contributions even if haven't had clients?

mgdavid

GunJack wrote: »

.......
...but I don't relish the idea of means-testing the basic SP after I've (and sooo many others) will have 40-50 yrs of contributions new starters maybe, but the govt trying to shut the gate after the horse has bolted is plain wrong.....

absolutely right; but one cannot help wondering how SP for all will be affordable in 20 to 30 years time, given the current rate of increase in longevity etc.

Linton

mgdavid wrote: »

absolutely right; but one cannot help wondering how SP for all will be affordable in 20 to 30 years time, given the current rate of increase in longevity etc.

The State Pension Age will be increased in line with longevity.

GunJack

Linton wrote: »

The State Pension Age will be increased in line with longevity.

as has already begun to happen, mine's currently 67, but there's the threat of further increases before I get there, which is the unfair bit... lines in the sand are needed or how else is anyone supposed to plan their retirement??