Pension pittance - best way forward

Suffolk_lass

Start with State Pension Forecast and go on to the HMRC tool via Gov.uk for each of you (there is a straightforward registration process).

It sounds as though you will have some gaps if you are not working. You may be able to boost your own record for periods when you were (are) a carer - certainly the child benefit years will count if you were the named claimant (it is why they like the Mum to claim). When you can see the gaps, you can look at the criteria for filling them in and then review what you could do and whether you can afford to do so. For example, if you do not have qualifying years in the last 6 years you could make these up (either credits such as caring for a dependant) or paying voluntary Class 2 NI contributions - the limit is going back up to 6 years. Carer credits are not limited to 6 years but paying is.

Going back to the question of consolidation of pensions you (your husband) needs to find out what type of pensions he has. If any of them are defined benefits (DB) it is likely that the "pot" will have been increased by some form of index-linked growth for each year since your husband stopped paying in. Defined contribution schemes (DC) are based on a contribution you make that is invested for you and relies on growth. There are several benefits -

• tax relief on contributions you make
• contribution by employer (if it was an employer's pension scheme)
• the power of compound interest
• more recently, the ability to draw-down (withdraw) money in retirement

dunstonh is an IFA so well worth reading his posts over again. You need to research what you have before jumping to the nuclear options, if you get my meaning. Make sure you understand what you have and what that means before you consider any move away from it (them).

AnotherJoe

purple_window_shopper wrote: »

No I am not in paid employment and I am embarrassed to say I have no idea about the pension. When I say I am clueless I mean I am truly and absolutely clueless, although I am trying to rectify that now. 😕

Here's the basics re what I suggested re free money.

You open a pension, lets say its the type called a "SIPP" though there are others .

You pay in £2,880.
The government very kindly adds £720.
Now its £3,600.

Take out £2,600 to do whatever you want with, leaving £1,000 (because with some companies at least you'll be charged if you take too much out and £1,000 is a threshold with the one I am aware of).
Next year, add in £2880 again, again bumped up to £3,600.
Now you have £4,600 in it (leaving your £1,000).
Take out £3,600.
Rinse and repeat.
A free £720 every year.
When you are 75, take your £1,000 out.

Whats not to like.

purple_window_shopper

Suffolk_lass wrote: »

Start with State Pension Forecast and go on to the HMRC tool via Gov.uk for each of you (there is a straightforward registration process).

It sounds as though you will have some gaps if you are not working. You may be able to boost your own record for periods when you were (are) a carer - certainly the child benefit years will count if you were the named claimant (it is why they like the Mum to claim). When you can see the gaps, you can look at the criteria for filling them in and then review what you could do and whether you can afford to do so. For example, if you do not have qualifying years in the last 6 years you could make these up (either credits such as caring for a dependant) or paying voluntary Class 2 NI contributions - the limit is going back up to 6 years. Carer credits are not limited to 6 years but paying is.

Going back to the question of consolidation of pensions you (your husband) needs to find out what type of pensions he has. If any of them are defined benefits (DB) it is likely that the "pot" will have been increased by some form of index-linked growth for each year since your husband stopped paying in. Defined contribution schemes (DC) are based on a contribution you make that is invested for you and relies on growth. There are several benefits -

• tax relief on contributions you make
• contribution by employer (if it was an employer's pension scheme)
• the power of compound interest
• more recently, the ability to draw-down (withdraw) money in retirement

dunstonh is an IFA so well worth reading his posts over again. You need to research what you have before jumping to the nuclear options, if you get my meaning. Make sure you understand what you have and what that means before you consider any move away from it (them).

Thank you so much, I really appreciate people tak g the time to help me. 😊