Deferring a further year and/or Top Up ..etc

saver861

uk1 wrote: »

I still smugly look at that stash in Newcastle until 2017 earning 4.2%

These rates are a reminder that there will be people out their with annuities at 15%. I expect they might be long in the tooth but neither will they be in a hurry to cash them in next year!!

uk1 wrote: »

The best cash balance transfer I was able to milk was a BMI MBNA .... Nothing compared to your free mortgage though.

lol ... MBNA were the best!! The cash transfer totally free and we had the AOL MBNA card which gave points for free broadband. I used to transfer £10k or £15k back and forth just wracking up broadband points. I worked out I saved just short of £1,000 in broadband costs which were around £15/£20 per month then. They also gave us the biggest limits - we had £20k on each card with them!

The timing just landed right for us with the 0%'s. More luck than judgement. I don't remember all the details but we were onto it from the start around late 90's and had between £50k and £100k on cards most of that time. It was the equivalent of someone giving us £100K for a number of years for us to cream 5% per year. On top of that, the 5% yearly savings were reinvested thus making returns on those monies also.

These are all war stories now and people always talk more about their wins than the losses. However, anyone who played the cards right really were onto a winner.

The ability to make that much money, totally for free and at zero risk, will never happen again. Sometimes I think to myself, 'did that really happen'.

Fee free cards are making a bit of comeback and so there will be options but in reality, the very high limits on multiple cards that we had then won't be possible.

Ruy

uk1 wrote: »

Many thanks.

As I get to grips with this I seem to forget the answers to simple questions I had previously understood. I have read the pdf but it confuses me more. So please indulge me a couple of clarifying recaps.

1. The 10.4% is applied to the pension you would have taken if you had retired "when you should have done" not the current higher one. So if it was £110 then but £120 now it is 10.4% of £110 not £120.

.

Sorry to complicate matters from a while ago, but having just come off the 'phone to the DWP, they have confirmed that extra state pension is always calculated based on the state pension entitlement amount at state pension age, i.e in the above example, calculated on £110 which was the entitlement at state pension age, NOT on any subsequently increased amount at the time of claim such as the £120 mentioned.

So, the original assumption by UK1 appears to be the correct interpretation, and not the further 'interpretations' adopted subsequently by UK1 and others.

Unfortunate, but did seem too good to be true!

kidmugsy

Ruy wrote: »

Sorry to complicate matters from a while ago, but having just come off the 'phone to the DWP, they have confirmed that extra state pension is always calculated based on the state pension entitlement amount at state pension age, i.e in the above example, calculated on £110 which was the entitlement at state pension age, NOT on any subsequently increased amount at the time of claim such as the £120 mentioned.

So, the original assumption by UK1 appears to be the correct interpretation, and not the further 'interpretations' adopted subsequently by UK1 and others.

Unfortunate, but did seem too good to be true!

That's not what their booklet says. Read p12.
https://www.gov.uk/government/uploads/system/uploads/attachment_data/file/372517/dwp024-102014.pdf


UPDATE: I've just checked my wife's figures. She got her 10.4%s based on her pension at restart date, just as I said above. It is too good, and yet it's true. It's a rotten deal for the taxpayer, which is why the coalition changed it for the new-style pensions.

PennyForThem_2

kidmugsy wrote: »

Many thanks. For a married man with a wife of the same age or younger it's an even better deal.

The OP might also be interested in the following point. Sometimes (I have no idea how often) if someone who defers also has a DB pension (e.g. a Final Salary pension) and he notifies his pension scheme, he can end up with a bigger FS pension than he would otherwise get, throughout the period while his State Pension is deferred. Talk about jam on your bread and butter!!

Does this apply to NHS Pension 1995?

Ruy

kidmugsy wrote: »

That's not what their booklet says. Read p12.
https://www.gov.uk/government/uploads/system/uploads/attachment_data/file/372517/dwp024-102014.pdf


UPDATE: I've just checked my wife's figures. She got her 10.4%s based on her pension at restart date, just as I said above. It is too good, and yet it's true. It's a rotten deal for the taxpayer, which is why the coalition changed it for the new-style pensions.

Thanks Kidsmugsy for checking your wife's figures.

The problem is how to convince the DWP, as when I quoted their own example on page 12 back to them, their own 'specialist' to whom I was passed, admitted that the date in the example was 'ambiguous' but was adamant that the pension 'On the date she claims...' refers to the extra pension being calculated on the pension at State Pension Age and not actually on the restart date i.e the actual date of claim.

Any advice or similar experience from anyone?

jamesd

Not sure what to say other than that the information you received in the phone call was misleading.

The extra really is calculated as a percentage increase in whatever it is at the time that deferring ends, then it's inflation-linked with CPI (not triple lock) from then on.

However, the specialist may not have been entirely wrong. For those who have been contracted out there can be some inflation-related calculation of a deduction for being contracted out. That calculation probably would be done at the point of reaching state pension age. But then all subsequent inflation-linked increases to the end of deferring would be added to the entitlement so the effect is just as described here rather than in the phone call.

patanne

I think you will find that the operative phrase is "on the date she claims" as opposed to on the date at which she is entitled to claim. Not all of those answering the phone actually understand WHAT they are saying and just follow the script & everything is alright until they decide to paraphrase.