Claiming State Pension while still working

xylophone

I do not work but do not claim any benefits I will not reach state pension aged until 2023.

Have you requested a new state pension statement to help with planning?

https://www.gov.uk/state-pension-statement

https://www.gov.uk/government/uploads/system/uploads/attachment_data/file/181235/derived-inherited-entitlement.pdf

saver861

kidmugsy wrote: »

When he dies you'll inherit most of it: given how much younger you are that makes it a ridiculously good deal. And it sounds as if it'll save you tax too.

The spouse won't inherit most of the pension - none of the basic state pension is inheritable which is likely to be most of it.

atush

It was my understanding he meant the deferred part of the pension

saver861

atush wrote: »

It was my understanding he meant the deferred part of the pension

The spouse can inherit all or part of the extra pension on death. Also the spouse can inherit part of any additional state pension. However, none of the basic state pension can be inherited which is likely to be the bulk of the pension.

Anybody making decisions would need to be clear on what they can, and cannot, inherit. The amounts of the total pension versus all the inheritable pension are likely be considerably different.

kidmugsy

saver861 wrote: »

The spouse won't inherit most of the pension - none of the basic state pension is inheritable which is likely to be most of it.

You've misunderstood. We're discussing the Extra Pension he'll get by deferring drawing his State Pension. It is, as I say, heritable: the bit corresponding to Basic Pension is 100% heritable, and the bit corresponding to Additional Pension is 50% heritable.

xylophone

Pages 12-14 of https://www.gov.uk/government/uploads/system/uploads/attachment_data/file/181235/derived-inherited-entitlement.pdf

seem relevant to the OP's case.

saver861

xylophone wrote: »

Pages 12-14 of https://www.gov.uk/government/uploads/system/uploads/attachment_data/file/181235/derived-inherited-entitlement.pdf

seem relevant to the OP's case.

I'm not sure this made it clearer lol. It is not clear if the OP has any accrued state pension - she does say she does not work nor claims benefits. That may be recent or it may have been all the time.

On the assumption she has no state pension herself, what is she entitled to inherit? The link states that 90% of people are likely to have full state pension accrued by the time of retirement and inheritance was originally aimed at wives who would likely be widowed before state pension age in years gone by.

xylophone

It is not clear if the OP has any accrued state pension - she does say she does not work nor claims benefits. That may be recent or it may have been all the time.

It may well be that the OP is entitled to a pension in her own right as a couple of years ago she said

I am mid 50,s worked all my life, never claimed ESA and only claimed JSA once for 6 weeks about 2 years ago, so very unsure of the system.

https://forums.moneysavingexpert.com/discussion/comment/58102945#Comment_58102945

However, we know that the OP becomes eligible for state pension after single tier and her spouse before single tier.

The pages referenced in my link concern derived entitlement to state pension in what is termed "Scenario 2"

a. Dependant reaches State Pension age in single tier
b. Contributor reaches State Pension age OR dies in the
current system

Reduced rate election is also discussed and inheritance of deferred pension when the Contributor reaches SPA in the current Scheme

This seemed closest to the situation outlined by the OP - however, she can read the whole link and obtain a new state pension statement for clarity.

Just_caring

Thank you all, I am reading through all your replies and trying to take it all in.

I will have a full state pension in my own right.

jamesd

saver861 wrote: »

On the assumption she has no state pension herself

She has a state pension entitlement of her own. even if she didn't, she could inherit even if she didn't meet the minimum number of years requirement, see paragraph 31.

saver861 wrote: »

what is she entitled to inherit?

"Deferral:
41. Where the Contributor reaches SPa in the current scheme, the surviving Depandant will be able to inherit deferred pension under the existing rules even if they are in the single tier. This is because a person reaching SPa in the current system could already have made the decision to defer – and ssumed that their surviving spouse or civil partner would be able to inherit."

He reaches state pension age while the current rules are in effect, so this says that the current rules will be used to decide what she will inherit.

The current rules provide for inheriting all of the deferral increase for the basic state pension and half or more of the deferral increase for the additional state pension (page 33). The "or more" applies to much of the money paid in under SERPS.

For simplicity I usually describe this as either about 75% (assuming fill BSP and quite a bit of ASP) or most of it (where there is little ASP). This avoids overstating what will be received while still making the point that it'll be significant and more than the spousal pension paid by typical dual life annuities.