Making up lost years - State Pension

thriftytracey

Hi


My husband is 63 and his SRA is 66. We obtained a state pension forecast and he has 4 missing years. To achieve full pension at 66 we need to pay a tad over £3k. I have always thought this was a no brainer as I believe it takes 4 years of State Pension to break even.


When I mentioned this to him he pointed out that as a Type I diabetic he may not live over 70 and therefore may not be worth paying and has a family history of cancer. I had never even thought of this.


He is in fairly good health at the moment - his diabetes control could be better but it isn't bad. I think he is being overly pessimistic - but he says he is being realistic.


I still think we should pay the additional contributions. I don't want to use our savings for this but could save manage to do it over the next 3 years saving from our joint income.

I wondered if there were any MSEers with life limiting conditions like this in the same situation?


Typing this I am still of the opinion that we should do it. I will also need to make up lost years due to opt out but have more time to do it. After all a perfectly healthy person could die before SPA.

GunJack

Is he still working/claiming JSA/other benefits that give NI credits/elgible for free NI credits due to pension equalisation rules?

It's worth looking at these first before paying for something he could get anyway...

edit - prob not the last one as he's probably too young

squirrelpie

It comes down to personal attitudes to risk. But whatever you do is a gamble. If you don't buy the additional years, you risk having less money in the future. If you do buy them, you risk having less money now. I think the question I would ask myself in that situation is, can I afford to lose the sum of money represented by those contributions? If I could, then I would pay the contributions, and hope to receive them back in the future. When do these contributions have to be paid? The later you pay them, and assuming his health has not got worse, the better the odds of the gamble.

thriftytracey

GunJack wrote: »

Is he still working/claiming JSA/other benefits that give NI credits/elgible for free NI credits due to pension equalisation rules?

It's worth looking at these first before paying for something he could get anyway...

edit - prob not the last one as he's probably too young

No, he is now retired.

thriftytracey

squirrelpie wrote: »

It comes down to personal attitudes to risk. But whatever you do is a gamble. If you don't buy the additional years, you risk having less money in the future. If you do buy them, you risk having less money now. I think the question I would ask myself in that situation is, can I afford to lose the sum of money represented by those contributions? If I could, then I would pay the contributions, and hope to receive them back in the future. When do these contributions have to be paid? The later you pay them, and assuming his health has not got worse, the better the odds of the gamble.

Good point, squirrelpie. I guess there isn't a specified period before SRA when they additional contributions need to be paid but I will check that. If there isn't then I could "squirrel" it away.

kwame41

If you think of it as an investment, paying the lost years will give you a very good return.

As long as he lives long enough (respectfully) to enjoy the additional pension amount.

If you can afford it, its a no brainer.

GunJack

thriftytracey wrote: »

No, he is now retired.

As he is below state pension age, he could sign on for JSA (or ESA if his health isn't great) and get NI credits for his final 3-4 years... a few hoops to jump through but wouldn't cost you up front for the NI years....

thriftytracey

GunJack wrote: »

As he is below state pension age, he could sign on for JSA (or ESA if his health isn't great) and get NI credits for his final 3-4 years... a few hoops to jump through but wouldn't cost you up front for the NI years....

Hi GunJack


He is in receipt of a DB Pension so does not qualify for JSA. He did go some years ago when unemployed and they told him not to bother signing on as he had enough years of NI contributions and would not qualify for JSA. He was on the DB pension back then and I was earning. After a spell of unemployment he went self-employed.


In hindsight I wonder if that was correct advice.


Too late now. I guess.

nicknameless

A study published in JAMA in 2015 (one of the leading general medical journals) based on a Scottish cohort study presents life expectancy data for people with T1D of different ages. This suggests that men with T1D aged 60-64 have an estimated additional life expectancy of 15.2 years as compared to 20.8 years for men without T1D. I can let you have the link if you are interested, although it is an academic paper and so not the most user friendly.


I see a lot of people (including my own family - brother-in-law is a T1D) underestimating longevity compared to people without the condition. Most of the loss of life expectancy prior to aged 50 is due to fatal events, often in the not yet diagnosed. My BIL was nearly one of these when diagnosed in his mid 40s after nearly dying due to a diabetic coma. If you just google life expectancy for those with T1D then it doesn't tell the whole story and the larger figures you find if doing so do not necessarily apply to the individual of a specific, and perhaps older, age.


Buy the pension lol!


I work in academic health research BTW.

nicknameless

p.s. family history of 'cancer' (generic - doesn't make sense as cancer is 100s of different diseases) is not a good way to definitively judge risk of cancer, and mortality from such if it were to come to that.


My mum has had ovarian and breast cancer, yet as her son I fear neither lol!