New State Pension starting amount and full record of qualifying years- trial service

michaels

OK - the tool says I have 24 qualifying years and an amount based on current contributions of 148 which to me suggests I have a fair bit of S2P as otherwise I would be on more like 24/35 * 155?

But then it goes on to say that my expected pension if I make 20+ years more contributions is 155 - ie the standard amount so what has happened to the S2P at that point?

It also says that in general each year of contributions will earn about £4 extra pension so does this mean after 2 years my pension record will get me the full 155 and that all the NI I pay thereafter (for the next 20 odd years to age 67) will earn me no more pension?

xylophone

OK - the tool says I have 24 qualifying years and an amount based on current contributions of 148 which to me suggests I have a fair bit of S2P as otherwise I would be on more like 24/35 * 155?

See https://www.gov.uk/government/uploads/system/uploads/attachment_data/file/503899/your-state-pension-explained-Feb_2016.pdf

You start at the higher of new state pension or old state pension.

Your starting amount is higher on old state pension.

Then
" Each ‘qualifying year’ you add
to your National Insurance record after 5 April 2016 will add a certain amount (about £4.45 a week,
this is £155.65 divided by 35*) to your ‘starting amount’, until you reach the full level of the new State
Pension or you reach State Pension age whichever happens first."

p00hsticks

michaels wrote: »

does this mean after 2 years my pension record will get me the full 155 and that all the NI I pay thereafter (for the next 20 odd years to age 67) will earn me no more pension?

Yes, it does

JoeCrystal

Until, they change the amount of years needed for the full pension. It is not that long ago when you needed 44/39 years contributions. So arguably, it is not a total waste to accrue more years, especially if they decide to increase the years required for higher than 44 years instead in the few decades.

michaels

So unless your s2p already gives you more than new state pension (more than 25 years of s2p approx?) then all those s2p payments were a waste of time and you would have been better off contracted out for about 10 years?

wotsthat

michaels wrote: »

So unless your s2p already gives you more than new state pension (more than 25 years of s2p approx?) then all those s2p payments were a waste of time and you would have been better off contracted out for about 10 years?

The 'winners' are those who have been contracted out forever and young enough to be able to multiply £4.45 by working years to get from the calculation on the old system to £155.

In my case the ever helpful snowman calculated I need 6 years post 2015/16 to get to £155. That means c40 years of my NI payments will have accrued pension of one sort of another and I get to keep the pension built up from the NI rebates too.

I won't be working (touch wood) to anything like state retirement age and expect about the time my NI doesn't accrue any more state pension entitlement I'll have packed up.

greenglide

and you would have been better off contracted out for about 10 years?

Only if you had the option to and had chosen not to. Usually this would only be an option by joining or not joining your employer's pension scheme (which is generally a no brainer) unless you had a personal pension which had the option of contracting you out which hasnt been available for some years now.

michaels

Could have contracted out but chose not to as I thought it was lower risk - oh well, you lose some, you lose some

Looks like I might as well stop working and live off tax credits in 2 years.

GunJack

michaels wrote: »

OK - the tool says I have 24 qualifying years and an amount based on current contributions of 148 which to me suggests I have a fair bit of S2P as otherwise I would be on more like 24/35 * 155?

But then it goes on to say that my expected pension if I make 20+ years more contributions is 155 - ie the standard amount so what has happened to the S2P at that point?

It also says that in general each year of contributions will earn about £4 extra pension so does this mean after 2 years my pension record will get me the full 155 and that all the NI I pay thereafter (for the next 20 odd years to age 67) will earn me no more pension?

no, not 24/35 of newSP, more like 24/30 of old BasicSP (plus as you correctly state, your S2P/SERPS to get up to the £148).

You may or may not get any pension benefit for the last 20 years of NI (as has been stated, unless they change the rules again) but it will qualify you for NI-dependant benefits should the need arise in that time period, so I wouldn't be too begrudging about them......

Muddled_Pensioner

Well I don't now where I was when the Pension Fairy was handing out pensions, as I seem to be trailing well behind numerous folk on here, when it comes to what I hope to get when that day eventually arrives!
I only joined here yesterday, and have spent hours ploughing through from the Snowman's Original, way back in Nov 2015 to get to here.

I received a paper update that I requested at the start of February this year which gave me my best starting figure as £119.20 and that's with 41 full years of NI. Of those, 24 years were contracted OUT.

I managed to get online quite effortlessly yesterday and saw that my lowest starting point was £122.42, (as at 5th April 2015) which could be increased to around £142.64 if I contributed the 5 years before I reach SPA in September 2020, just 20 days short of my 66th birthday.

Today, again logging in is easy but surprised to see that my Forecast has now DROPPED to £121.75 and the maximum I can top up to has also fallen back to £141.31 !!!!

Firstly I'd like to know are others seeing these Forecasts changing, on a daily or whatever basis?

Secondly: How have I drawn such a short straw? 41 years of contributions (admittedly 24 C/O) only generating a meagre £121.75

Thirdly: I've still 4 incomplete years from 1975 to 2015 (3 of which I am still allowed to top-up) if thought sensible to do so on here.

Any advice would be appreciated.

What a minefield Mr Steve Webb created when he let slip...Oh! I should have made it clearer, I meant 35 years of Full Contributions!