State Pension - Utterly Confused

Uplander1111

Having spent the afternoon looking at .Gov sites 'til I feel like screaming, I have then spent some time trawling through posts on MSE but have concluded I should post and hope someone can unscramble my brain.


I was made redundant at 60 (2013) and I am not working and not claiming benefits (house husband). My statement says I have 45 qualifying years of which I calculate 20 would have been contacted out. I am due to get my state pension in 2018.


I got a pension forecast in 2012 saying that my pension would be £120 p.w.


I have just obtained a new forecast that provides two figures (new rules £92 p.w./ old rules £135 p.w.)


Like with everyone I am trying to map the future and the following are my questions:


> Is there any way I can check the £92 as this seems low?


> Is the change from £120 to £135 accounted for by two further year's NI contributions (before redundancy) and any increases in state pensions?


> Am I right in assuming that in my case paying additional (voluntary) NI contributions is entirely inappropriate?


Thanks in advance

jem16

Uplander1111 wrote: »

> Is there any way I can check the £92 as this seems low?

Not that I'm aware of. However it doesn't seem low in light of what others have been posting.

> Is the change from £120 to £135 accounted for by two further year's NI contributions (before redundancy) and any increases in state pensions?

It's not the increase in NI contributions as you have way over the maximum 30 years under current rules. More likely to be the increases over the last 3 years.

> Am I right in assuming that in my case paying additional (voluntary) NI contributions is entirely inappropriate?

At the moment yes as you have more than enough so won't make any difference. After 2016 you might be able to pay some more to increase your £135.

zagfles

Yes £92 is not low for someone who's had 20 years contracting out,in fact it looks high! People who've had decades contracting out will almost always be better off on the old rules calculation.

Uplander1111

Thanks folks, sounds like my plan is to bide my time now and then get a further statement once the new system is operating. Appreciate the help.

jem16

Uplander1111 wrote: »

Thanks folks, sounds like my plan is to bide my time now and then get a further statement once the new system is operating. Appreciate the help.

If you've just had one now, it won't change again apart from uprates for inflation.

xylophone

What is of interest to you is the higher amount - you will receive at least this under the new system and may be able to buy credits after 2016 to get you closer to the full new state pension.

Are you receiving a final salary pension at the moment?

Presumably you have pre 88 and post 88 GMP - has the pension administrator clarified what will happen to increases on this part of your pension after you reach GMP age? (65).

drumtochty

As others have said there is no reason to pay any extra NI before April 6th 2016.

You should pay Class 2 voluntry contributions in 2016 2017 and 2017 2018 and if you can get away with it if you can pay a full year in 2018 2019.

That would get you nearly to the flat rate pension.

With regards to your existing system pension forecast and the difference over two years my best guess is the the orgininal 2012 statement was obtained too early in the tax year to get the second state pension updated and from the year before and your your recent statement had your 2011 2012, 2012 2013 and possibly your 2013 to later in 2013 when you were made redundant.

redbuzzard

Funnily enough I'm the same age, I was almost certainly contracted out from 1978-1997, and have 44 years contributions.

My forecast from the e-service under the old system is £123.16, being 113.10 plus some ASP/GRB. .

So I'm a very similar case. I've just last week sent off the written request for a forecast under the new system, and based on what I have seen reported by others, I won't be surprised if it is not unadjacent to £92!

bigfreddiel

All of you that have been contracted out obviously will get a lower state pension because you have not made the extra contributions. Hopefully you're not expecting something for nothing!

In addition those who contracted out no doubt made a contribution to your company or private pension so that will make up the supposed shortfall.

So there you have it - we've all made similar contributions, to either our state or private pension and we all end up with a similar pension income when we retire. We're all getting what we've paid for, so we can all calm down and stop feeling hard done by!

Cheers fj

redbuzzard

bigfreddiel wrote: »

All of you that have been contracted out obviously will get a lower state pension because you have not made the extra contributions. Hopefully you're not expecting something for nothing!...

We're all getting what we've paid for, so we can all calm down and stop feeling hard done by!

Cheers fj

Quite. Good thing I'm not feeling hard done by!

As far as this board goes, it should be old news, but in the rest of the world I suspect there are a lot of people who will be disappointed, because the bit of news that stuck was the flat rate pension of £144 p.w.

The point to note is to get a pension forecast.

bigfreddiel

redbuzzard wrote: »

Quite. Good thing I'm not feeling hard done by!

As far as this board goes, it should be old news, but in the rest of the world I suspect there are a lot of people who will be disappointed, because the bit of news that stuck was the flat rate pension of £144 p.w.

The point to note is to get a pension forecast.

You may not feel hard done done by, but from what I've read here and other forums, newspapers and so on many people do feel hard done by and think others are getting more so why shouldn't they as well!

And you're right, £144 sticks in people's minds and no one took any notice of the finer points of the new scheme. Maybe the gov should have made more of an effort to highlight this in their original announcement, but then it wouldn't have sounded so good would it!

And yes get a forecast and see just how much you're entitled to.

Cheers fj