Basic State Pension & COPE

Curious_Moose

Silvertabby wrote: »

Are you sure you're reading it correctly? When I did my online forecast, my foundation amount was £138, and my COPE was £60 - but that doesn't mean that my State pension forecast is £138 - £60 = £78. It means that my State pension would have been £138 + £60 = £198 if I hadn't been contracted out.

In the example on their website "Mary" has paid 35 years NI to be entitled to £155.65. However, she also has a COPE of £22.70 meaning her state pension will be £132.95. I.e. the COPE is a deduction from the maximum state pension based on 35 years if there had been no contracting out.

Silvertabby

“ Are you sure you're reading it correctly? When I did my online forecast, my foundation amount was £138, and my COPE was £60 - but that doesn't mean that my State pension forecast is £138 - £60 = £78. It means that my State pension would have been £138 + £60 = £198 if I hadn't been contracted out.
Originally posted by Silvertabby ”

In the example on their website "Mary" has paid 35 years NI to be entitled to £155.65. However, she also has a COPE of £22.70 meaning her state pension will be £132.95. I.e. the COPE is a deduction from the maximum state pension based on 35 years if there had been no contracting out.

You need to look at your own forecast, not mythical Mary's !

Curious_Moose

Silvertabby wrote: »

You need to look at your own forecast, not mythical Mary's !

I have! That's why it looks like the COPE they quoted for me is a deduction from the £155.65 (which was also quoted). So it looks like I'll never get the £155.65 from the state. Unless future years above 35 can somehow reduce the COPE used.

xylophone

http://www.thisismoney.co.uk/money/pensions/article-3838476/Can-pay-new-state-pension-Steve-Webb-replies.html

molerat

Please tell us word for word and number for number what your forecast states. How old are you, how many years have you got to go until SP age, the forecast will tell you. How many years does it state you need to contribute to reach the £155. The forecast will not show you the £155.65 figure unless you have already got that amount or you can achieve it, mine does not show that amount because I cannot achieve it in the 3 years I have left. Future years will not reduce the COPE amount and it is irrelevant going forward from 2016, COPE only affects your April 2016 figure.

Curious_Moose

xylophone wrote: »

http://www.thisismoney.co.uk/money/pensions/article-3838476/Can-pay-new-state-pension-Steve-Webb-replies.html

Thanks, that link does make the point that even if you were extensively contracted out, you can make a voluntary payment and so get an extra 1/35 or £4.45 per week.

So the next question is, if you were to reach 35 years NI in say 3 years time at which point you had a COPE of £30, i.e. the state pension would be £155.65 - £30 = £125.65, would you earn the £4.45 per week if you carried on working and paying NI (i.e. not a voluntary NI, but just work related NI). So after 36 years would you have £155.65 - £30 + £4.45= £130.10 instead of £125.65?

molerat

COPE is not relevant in 3 years time, it is only used in the calculation of the 2016 foundation amount, the figure you have NOW. What you contribute going forward by voluntary, employment or benefits will add to the current figure.

Curious_Moose

molerat wrote: »

COPE is not relevant in 3 years time, it is only used in the calculation of the 2016 foundation amount, the figure you have NOW. What you contribute going forward by voluntary, employment or benefits will add to the current figure.

Thanks for that. None of this is particularly clear on their website, and that's after I've registered and they're showing my specific details!

Silvertabby

OK, let's try another tack. How old are you, when is your State pension age, and when do you intend to stop working.

p00hsticks

Curious_Moose wrote: »

So the next question is, if you were to reach 35 years NI in say 3 years time at which point you had a COPE of £30, i.e. the state pension would be £155.65 - £30 = £125.65, would you earn the £4.45 per week if you carried on working and paying NI (i.e. not a voluntary NI, but just work related NI). So after 36 years would you have £155.65 - £30 + £4.45= £130.10 instead of £125.65?

Yes.

But forget about the 35 years figure - the transitional rules for those well into their working lives means this doesn't have the same significance as it will do for those starting now.

Also ignore the COPE figure.

All you need to know is your starting amount as at 6/4/16 from your pension forecast (this may be the '£155.65 - COPE' figure you mention, but could be your entitlement under the old rules if higher).

Any NI years earned or bought going forward will add £4.45 to that starting amount until you reach either the £55.65 maximum or State Pension Age, whichever comes first.