New State Pension Guide

NorthernMonkey1

Thanks everyone.

I just wanted to check I was probably on track to receive the full amount. I was a bit of a financial mess until a few years ago. Trying to get things back on track now.

westv

I finally managed to get round to finding out what my forecast is via the online service.
Apparently it's £129 at April 16 and £155 with another 6 years NI contributions.

Estimated £68 COPE amount

NorthernMonkey1

molerat wrote: »

You need to get a forecast to get your starting amount as I doubt you will have only 17 years basic pension, you most likely have some SERPS/S2P accrued. There is also the addition of 3 years credits from when you were 16-18. Your method of calculating the required years is correct though.

You were correct Mr Molerat

I've just checked online, which was easier than I expected, and my starting position as of April 2016 is £91.19. Thanks for your help all

Johnkst

gadgetmind wrote: »

Are pre 2016 years purchased now treated differently to post 2016 years purchased in the future?

Gadgetmind asked this question back in April and, as far as I can tell, never received an answer. The only reason I am bringing this up is because this is pretty much my question too...

Background...
Although I'm over 60, I currently only have 20 qualifying years, due to having worked abroad. I currently also have the option of increasing this figure to a maximum of 30 years by paying up to 6 years of voluntary Class 3s for the period up to 2016 and another 4 years post 2016.

As I understand it, the 4 years voluntary payments post 2016 are a no-brainer and I fully intend to make these payments. My question relates to the 6 years of pre-2016 payments. I know what they will cost me, but I'm not clear as to what (financial) benefit I will get from making these payments.

On the government website, it states 'Each qualifying year on your National Insurance record after 5 April 2016 will add about £4.45 a week to your new State Pension.' Maybe I'm being overly suspicious, but that suggests to me that qualifying years on my National Insurance record BEFORE 5 April 2016 will add a lesser amount to my new State Pension.

Has anyone else looked into this and come up with a figure? Or does it vary too much from one person to another, depending on circumstances?

xylophone

Have you obtained a new state pension statement?

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

http://www.thisismoney.co.uk/money/pensions/article-3535618/STEVE-WEBB-Buying-ups-paying-missing-NI-boost-state-pension.html

Johnkst

xylophone wrote: »

Have you obtained a new state pension statement?

Thanks, Xylophone. Hadn't done that yet - only applied for and received my 'payments schedule'.

I did as you suggested and was very pleasantly surprised by how helpful the government Gateway site was. After registering (less 'painful' than I expected!), it told me how much I would get if I made no voluntary contributions, how much I would get if I just made contributions from 2016 onwards and also told me how much I would get if I topped up my 'missing payments' up to 2015. So basically everything I needed to know to make an informed decision!

The bottom line is that it IS worth my while making voluntary payments for the years between 2010 and 2015, so I will be doing so. This is probably because I am well below the required 35 years maximum. Might not necessarily work for everyone...

Thanks again for your good advice!

Froglet

Johnkst wrote: »

Gadgetmind asked this question back in April and, as far as I can tell, never received an answer. The only reason I am bringing this up is because this is pretty much my question too...

Background...
Although I'm over 60, I currently only have 20 qualifying years, due to having worked abroad. I currently also have the option of increasing this figure to a maximum of 30 years by paying up to 6 years of voluntary Class 3s for the period up to 2016 and another 4 years post 2016.

As I understand it, the 4 years voluntary payments post 2016 are a no-brainer and I fully intend to make these payments. My question relates to the 6 years of pre-2016 payments. I know what they will cost me, but I'm not clear as to what (financial) benefit I will get from making these payments.

On the government website, it states 'Each qualifying year on your National Insurance record after 5 April 2016 will add about £4.45 a week to your new State Pension.' Maybe I'm being overly suspicious, but that suggests to me that qualifying years on my National Insurance record BEFORE 5 April 2016 will add a lesser amount to my new State Pension.

Has anyone else looked into this and come up with a figure? Or does it vary too much from one person to another, depending on circumstances?

Yes, I spoke to someone recently who explained very clearly the differences.Pre 2016,each year is worth just under £4 ( I forget the exact amount,will have to look at the notes I made).For me,buying extra contributions is most definitely worth it,and will have paid for themselves in about 3 years.

p00hsticks

Froglet wrote: »

Pre 2016,each year is worth just under £4 ( I forget the exact amount,will have to look at the notes I made).

It would be £3.98 (it is worked out by dividing the £119.30 full 'basic' pension amount under the old rules by the 30 years required to obtain that full pension under the old rules).

Although you say that it was beneficial for you, it is not always the case to buy these additional pre-2016 years - it is unlikely to be worth it for those still to retire who have more than 30 years NI already.

Johnkst

Thanks to everyone who came back with an answer to my question.

Yes. The value is apparently £3.976 (£3.98 rounded) per week for contributions made for 'missing' years BEFORE 5 April 2016.

As I said, it makes sense for me to make voluntary contributions for these missing years as I am currently well below the level where paying more makes no difference.

Now I just need to decide whether to pay the money to HMRC now or wait until 2019...:D

molerat

Surely a year is a year irrespective of which side of 2016 it belongs to or is purchased. The value is only relevant according to whether the "old" or "new" system is used when calculating the 2016 starting amount which will be recalculated if gaps are filled.

Why are you limited to paying back to only 2010, are all 2006 to 2010 years filled ?