Why can't I increase my state pension?

Dazed_and_confused

I'm sure Gunjack and Silvertabby are right but have to confess I'm struggling to find that rule anywhere on t'internet!

Most sources suggest it's earnings which count so good wage for part of a year is sufficient with no difference mentioned for final year before retirement age.

pandora205

Silvertabby wrote: »

As Pandora has always/nearly always been contracted out then her estimate will be under the old rules.

I was contracted out from 1978 until 2016 (RAF and then Local Government) and expected my foundation amount to be the old State pension (£120) plus a bob or two of (pre 1975) graduated pension. It's actually £140 per week because of the 2002 SP2 top up for lower-than-average paid workers, as I took a drop in pay/less stressful job when I retired from the RAF.

I'm guessing that Pandora also has a bit of graduated pension/SP2 top up.

Not sure about that last bit Silvertabby. Would it be showing somewhere on my state pension forecast documents?

Silvertabby

Not sure about that last bit Silvertabby. Would it be showing somewhere on my state pension forecast documents? Posted by Pandora

Not as a separate amount. Assuming that your forecast reads much the same as mine, there's no actual mention that there still may be some SP2 top ups despite contracting out.

I had to dig for that, but seems that:

In 1978 contracted out pension funds were obliged to pay at least the amount of SERPS that the member had given up by joining the contracted out fund.

In 2002 SERPS became SP2 - which was intended to be more generous to those on low pay (what would have been minimum wage equivalent at the time) and, to a lesser extent, to those on less than average pay. It must have been a major undertaking to re-hash all the contracted out schemes (most of which were public sector by then) so the decision was made to pay the difference between SERPS and SP2 with the State pension.

As most of my post 2002 service was part time by choice, you'd have thought that would have been taken into account - but, no, it's just the £s in the pay packet that count and so I was classed as 'low paid' and get the highest rate top up.

The wonderful world of pensions!

pandora205

Silvertabby wrote: »

Not as a separate amount. Assuming that your forecast reads much the same as mine, there's no actual mention that there still may be some SP2 top ups despite contracting out.

I had to dig for that, but seems that:

In 1978 contracted out pension funds were obliged to pay at least the amount of SERPS that the member had given up by joining the contracted out fund.

In 2002 SERPS became SP2 - which was intended to be more generous to those on low pay (what would have been minimum wage equivalent at the time) and, to a lesser extent, to those on less than average pay. It must have been a major undertaking to re-hash all the contracted out schemes (most of which were public sector by then) so the decision was made to pay the difference between SERPS and SP2 with the State pension.

As most of my post 2002 service was part time by choice, you'd have thought that would have been taken into account - but, no, it's just the £s in the pay packet that count and so I was classed as 'low paid' and get the highest rate top up.

The wonderful world of pensions!

It's no wonder some of us get confused, is it? I like to think I'm fairly well informed but the finer points of the state pension do seem pretty opaque.

System

pandora205 wrote: »

It's no wonder some of us get confused, is it? I like to think I'm fairly well informed but the finer points of the state pension do seem pretty opaque.

Who would have thought that "flat-rate" could be so complicated?

Silvertabby

“ It's no wonder some of us get confused, is it? I like to think I'm fairly well informed but the finer points of the state pension do seem pretty opaque.
Originally posted by pandora205 ”

Who would have thought that "flat-rate" could be so complicated? Posted by Clifford_Pope.

To be fair, it's just the transitional period protections that are causing the confusion. In 33 years time - when everyone will have paid into nothing but the single tier pension - things will be much clearer.:rotfl:

GunJack

I'm also a winner from the low pay/S2P top-up, I had it pointed out to me by xylophone and others on a thread a fair while back...will have made full flat-rate SP entitlement by the end of next FY, with still another 15yrs of work to reach SP age

Scrounger

GunJack wrote: »

I'm also a winner from the low pay/S2P top-up, ... will have made full flat-rate SP entitlement by the end of next FY, with still another 15yrs of work to reach SP age

But that's 15 more years of NI contributions that won't do you any good. :eek:

Scrounger

GunJack

Scrounger wrote: »

But that's 15 more years of NI contributions that won't do you any good. :eek:

Scrounger

Yes it will...some goes to the NHS, some entitles me to claim other state benefits should I need them, etc.

NI has NEVER just been about State Pension entitlement....