Retirement stages

jerrysimon

I have already been bunging in money in a SIPP for my wife at the rate of her earnings of 6K/year these last two year should have over 12K having only paid in about 8-9K by April next year when she gives up work completly with me.

As my wife will only have a 3K work pension we could draw most of that out the SIPP in the first the year with no tax payable and as you say use it to top up both our SPs.

PS reading your post again if my wife is not paying tax then we cant make voluntary payements for her, but as I will on my work pension I can ?

Just chatted with my wife and she said it would be better to keep it in a SIPP (paying it just before SP age) as then at least we would have access to it if either of us died before SP kicked in. Though again like you said they may have stopped it by then. Man this is complicated!

Jerry

AnotherJoe

jerrysimon wrote: »

I have already been bunging in money in a SIPP for my wife at the rate of her earnings of 6K/year these last two year should have over 12K having only paid in about 8-9K by April next year when she gives up work completly with me.

As my wife will only have a 3K work pension we could draw most of that out the SIPP in the first the year with no tax payable and as you say use it to top up both our SPs.

PS reading your post again if my wife is not paying tax then we cant make voluntary payements for her

You can, you can pay in £2880 and get it topped up to £3600

Jonzo_2

You provide little information but if you think you can draw around £16,000 pa from your pension pots then I would say "go for it". Life is short and time cannot be bought once its gone. If money gets tight then maybe do a bit of part time work. The freedom of retirement is wonderful and it sounds like you owe to yourself to get off the treadmill. I read a scary statistic that 22% of men die before they reach 65. Does that help?

jerrysimon

Triumph13 wrote: »

That's precisely what I'm saying. Voluntary NICs are insanely good value. If you had £120 pw at April 2016 you'd need 8 more years to get to the full new SP level. You'll get one for this year so that leaves 7 to go. At current prices that would be a little over £5k of capital expenditure to get £1,300 a year post-tax income from 66.5. You could theoretically wait a few years to avoid tying up the money for so long, but I personally plan to pay each year as it comes in case HMRC put the prices up as it just seems too good to last.

I have been checking this, can you only do this if you have less than 35 years of contributions that were contracted out i.e. I already have over 35 years contributions albeit contracted out ?

I know at the moment as I am still working, and paying NI, I will be earning extra SP over and above the amount I qualify for being contracted out, but when I stop working in March 2017 and no longer pay NI, then I am told I will not be able to top up these NI payments ?

I will of course be paying tax on my pension so not sure if that entitles me o carrying one paying addition NI contributions to increase my final stat pension from £120/w to £155/w ?

Just to clarify I will be 56 and 1/2 when I start drawing my DB pension next March so 10 years before SP age.

Jerry