Missing NI contributions - should I top them up?

bergeroo

I am sure there is a thread somewhere but I can't find it.

I am 38 years old. I have not worked in the UK for 11 years, so have not made any national insurance contributions. Before I worked for 7 or so years.

I just came into some money and was considering getting a stocks and shares ISA, perhaps a bond, locking some money away for when I am older.

It occurred to me that maybe I should make up my 11 years of missed NI contributions to get my state pension.

Would it be worth it? Or should I just forget it as state pension could be negligible and I could be dead by the time I draw it etc ?

MallyGirl

I wouldn't do it now - I would wait till much nearer the time to see whether it is worth it. Just because there is a gap it doesn't necessarily mean you need to fill it in order to get the full SP.

nigelbb

If you have been working abroad then you can pay Class 2 self-employed NI contributions for the missing years at about £150 per year rather than the £780 per year for regular employed Class 3 contributions. Each missing year paid for adds about £240 per year of index linked pension for the rest of your life so it's a fantastically good investment.

You need 10 years of contributions to get any pension at all & you can buy up to six previous years at a cost of about £900. In your case that takes you to 13 years. If you still live & work abroad it's worth continuing to pay in for the next 22 years so you eventually get the full pension after 35 years that is currently £8440/year.

p00hsticks

First step, if you haven't already done so, is to get a personal State Pension forecast, which will tell you how many years you have and how many you need
https://www.gov.uk/check-state-pension

Note that if you have less than ten years so far this may say zero, as you now need at least ten years to get anything at all.

However,as you're 38, you should have been automatically creditted with the years you turned 16, 17 and 18 even if you eren't working, so with the seven years you think you have this will take you up to that minimum.

If you;ve been working abroad, you may also want to look into whether you'll be entitled to a pension from that country and/or if there are any reciprical arrangements.

https://www.gov.uk/national-insurance-if-you-go-abroad

If you are still working abroad now, then I have a feeling (but could be wrong) that any voluntary NI contributions you make can be Class 2 ones (considerably cheaper than Class 3) so this might be an incentive to buy a few years now. The future Pension Service should be able to help.
https://www.gov.uk/future-pension-centre

However as you're only 38 you've got another 30 years to go before you reach state pension agem so plenty of time to earn/buy/get creditted with sufficent years going forward.

bergeroo

nigelbb wrote: »

If you have been working abroad then you can pay Class 2 self-employed NI contributions for the missing years at about £150 per year rather than the £780 per year for regular employed Class 3 contributions. Each missing year paid for adds about £240 per year of index linked pension for the rest of your life so it's a fantastically good investment.

You need 10 years of contributions to get any pension at all & you can buy up to six previous years at a cost of about £900. In your case that takes you to 13 years. If you still live & work abroad it's worth continuing to pay in for the next 22 years so you eventually get the full pension after 35 years that is currently £8440/year.

No I haven't been working at all. I should have stated that.

Thanks for the info!

bergeroo

OK great - I did that and I got my forecast and it seems I have enough to get 10 years. I have 30 years until I get it!

Seems like I don't need to and probably shouldn't do anything yet. Good to look at it and check it, thank you for that link.

p00hsticks wrote: »

First step, if you haven't already done so, is to get a personal State Pension forecast, which will tell you how many years you have and how many you need
https://www.gov.uk/check-state-pension

Note that if you have less than ten years so far this may say zero, as you now need at least ten years to get anything at all.

However,as you're 38, you should have been automatically creditted with the years you turned 16, 17 and 18 even if you eren't working, so with the seven years you think you have this will take you up to that minimum.

If you;ve been working abroad, you may also want to look into whether you'll be entitled to a pension from that country and/or if there are any reciprical arrangements.

https://www.gov.uk/national-insurance-if-you-go-abroad

If you are still working abroad now, then I have a feeling (but could be wrong) that any voluntary NI contributions you make can be Class 2 ones (considerably cheaper than Class 3) so this might be an incentive to buy a few years now. The future Pension Service should be able to help.
https://www.gov.uk/future-pension-centre

However as you're only 38 you've got another 30 years to go before you reach state pension agem so plenty of time to earn/buy/get creditted with sufficent years going forward.