State Pension deferral - incorrect result ?

John_Pierpoint

Given a mixture of savings, inheritance and continuing to work, I have deferred my State Pension due at 65 by 4.5 years,

Well I don't want to pop my clogs without claiming my state pension. So I phoned the claim line and asked what I would be getting.
After a bit of computer keyboard work, entering my NI number, back came a figure:
£ 124.70 and the information that I had 49 years of contributions.

[I think it is only 46 from autumn 1965 until autumn 2011 but I am not quibbling]

However the figure of £124.70 is very little more than the standard State Pension.

I was not asked what I wanted to do with my deferred amount - ie take it as additional pension or a lump sum.

Have I misunderstood what I have been told ?
Could that be my "standard" retirement pension at age 65 incorporating a small element of additional earnings from the days before "opting out" ?
How do I get a statement showing the calculations ?

kidmugsy

It sounds like a simple blunder to me. Except for the unexplained three years: that could be the automatic three added covering years of age 16-19. The weekly sum should be 45% higher than the weekly sum that was due to you at 65. And they should have asked if you wanted instead to take the lump sum.

What are you planning to do with the lump sum?

P.S. if you pop your clogs before taking your state pension, the bulk of the extra pension you would have had will be paid to your widow.

bigfreddiel

Let's get this straight, you're 69.5 years old now?

I would ask for a written quote.

You won't be given a detailed breakdown.

You may get a breakdown of the base amount, and the deffered amount. It should be 10.5% compound interest over the last 4.5 years.

You could work this out for yourself to check the figure you eventually get from the gov.

Good luck fj

Linton

bigfreddiel wrote: »

Let's get this straight, you're 69.5 years old now?

I would ask for a written quote.

You won't be given a detailed breakdown.

You may get a breakdown of the base amount, and the deffered amount. It should be 10.5% compound interest over the last 4.5 years.

You could work this out for yourself to check the figure you eventually get from the gov.

Good luck fj

Unfortunately it's not compound interest and its not 10.5%, the calculation is deferred years X 10.4%.

greenglide

Unfortunately it's not compound interest and its not 10.5%, the calculation is deferred years X 10.4%.

Actually 1% for each five weeks of deferment isn't it? Goes to 1% for every 9 weeks of deferment under nSP.

Any odd weeks on the end (period is not exactly divisible by 5 or 9) is lost. DWP will probably not tell you of this.

You don't have to decide whether you want increments of lump sum immediately, you have three months to decide. Maybe they tell you when the claim is completed?

Alter_ego

greenglide wrote: »

Actually 1% for each six weeks of deferment isn't it? Goes to 1% for every 9 weeks of deferment under nSP.

Any odd weeks on the end (period is not exactly divisible by 6 or 9) is lost. DWP will probably not tell you of this.

I believe it's 1% for every 5 weeks. Hence 10.4 pa. Sorry you corrected while I typed

If you reach SPA under the old rules it remains 10.4 even after April.

uk1

It surprises me that as hard as I search, I cannot find a simple deferred pension calculator on the net. I would have thought that a few questions ie age, sex, years contribution, planned retirement date etc would be available somewhere ........

Jeff

Alter_ego

uk1 wrote: »

It surprises me that as hard as I search, I cannot find a simple deferred pension calculator on the net. I would have thought that a few questions ie age, sex, years contribution, planned retirement date etc would be available somewhere ........

Jeff

The deferment leaflet has a calculator of sorts.

uk1

greenglide wrote: »

Any odd weeks on the end (period is not exactly divisible by 5 or 9) is lost. DWP will probably not tell you of this.

Presumably you can specify a date to the DWP on which you wish to retire?

It is a shame there isn't a resource on the net where you can put in your normal retirement date and it gives you future optimum dates to maximise.

I wish I was good as spreadsheets.

Jeff

uk1

Alter_ego wrote: »

The deferment leaflet has a calculator of sorts.

I've read it so many times, including an hour or so ago, and basically although I am reasonably savvy the document seems to turn my brain to mush and I find the document totally confusing.

If someone sold a spreadsheet with all this stuff in I'd buy it.

Jeff

Alter_ego

uk1 wrote: »

I've read it so many times, including an hour or so ago, and basically although I am reasonably savvy the document seems to turn my brain to mush and I find the document totally confusing.

That's DWP for you!

I deferred after a few years claiming, so I have a base figure to calculate the 10.4% on.