How to work out if it is worth making voluntary NI contributions to make up gappy record.

Uberfaker

I'm 33 and only have 6 full years on record. I have no full years of contributions for the past 6 years.

According to the government website the cost of each available year varies wildly for me based on my contributions in that year. From £32 - £700. Is there a way for me to work out if it is worth it to purchase a year for £X.

Thanks a lot.

Dazed_and_confused

As you have 30+ years to go until State Retirement age do you actually need to make up these years?

You currently get an extra £4.70/week for each qualifying year so it might be prudent to pay £32 but paying £700 needs more thought.

On the face of it a good investment if you live a few years after State Retirement age but not so good if your work pattern over the next 30+ years means you would get to the maximum pension anyway.

Alice_Holt

To get the maximum (new) State Pension (currently c.£165 pw) you need 35 years of NIC's.
To get paid any State Pension you need 10 years of NIC's.

Qualification for the contribution-based benefits JSA and ESA look at NIC's in the last 2 tax years before the year in which you apply for that benefit.

It all rather depends what you envisage your future working career (and NIC record) will be.

I'd be inclined to pay the £32 year and any similar amounts, just as insurance against future "gappy" years.

Do you have any occupational / auto enrolment schemes in place?

calcotti

Alice_Holt wrote: »

I'd be inclined to pay the £32 year and any similar amounts, just as insurance against future "gappy" years.

I agree - provided you've funds available this is a very small outlay to give you more flexibility. However it does depend on how you see your future life working out.

[Deleted User]

I thought every year cost about £700? and remember you can only "buy back" around 7 years, but as above you still have 34 years to work and make cont. and you will need 35 (as the rules are today)

calcotti

venison wrote: »

I thought every year cost about £700? and remember you can only "buy back" around 7 years, but as above you still have 34 years to work and make cont. and you will need 35 (as the rules are today)

If you’ve got a part year you only have to pay for the missing weeks not the whole year.

Uberfaker

Thanks everyone. I will buy the cheap years only. Thanks.