The mysteries of GMP

brewerdave

Just had a missive from the administrators of my DB scheme thats been in payment for 6+years. They have not shown GMP as an item on any of the pension increase letters since I took the pension early (altho they showed a single figure on the initial letter I received when leaving employment).
HOWEVER, they have now shown two figures for pre and post 1988 GMP as I'm just about to reach 65 -the pre 1988 GMP will not increase whilst the post will increase 1st April by 3% or CPI if less.
The surprising thing (to me anyway!!) is that the pre 1988 GMP figure is considerably more than the post 1988 figure.
Don't think I was contracted out until ~ 1981 and stayed contracted out until redundancy in 1999. Why would the pre 1988 figure be so much more? Is there any way of calculating it ?

Drp8713

It doesn't matter at all, it just means you get the pension increase on the pre 88 GMP and any increase in excess of 3% on your post 88 GMP through your state pension.


You get exactly the same amount, its just who pays it to you, the scheme or the state.

xylophone

There was a difference in how the GMP was calculated between 1978 and 87 and the period to 1997.

The accrual of SERPS (to which GMP was roughly equivalent), changed in 1988.

A relative who was contracted out in a DBFS Scheme for the whole of the 78-97 period has a pre 88 GMP which is over £1000 higher than the post 88 GMP.

Do you need to advise your scheme administrator that you are deferring state pension? See post 27 https://forums.moneysavingexpert.com/discussion/5134610

brewerdave

xylophone wrote: »

There was a difference in how the GMP was calculated between 1978 and 87 and the period to 1997.

The accrual of SERPS (to which GMP was roughly equivalent), changed in 1988.

A relative who was contracted out in a DBFS Scheme for the whole of the 78-97 period has a pre 88 GMP which is over £1000 higher than the post 88 GMP.

Do you need to advise your scheme administrator that you are deferring state pension? See post 27 https://forums.moneysavingexpert.com/discussion/5134610

Thanks for that -I'll try to get hold of someone next week. I have a feeling tho', that since it was my choice to take the "levelling option" ie a higher pension from early retirement til SRA ,that my deferring makes no difference. As a matter of interest my pre 1988 GMP is nearly £3k more than post figure!!