When to buy back years for full state pension?

longman27

I am 58 and have taken my two employer pensions and stopped work. I have checked my state pension forecast and it says I have 42 years full contributions but also states I need to make 4 more years of contributions to get the full £175.20 in 2029. I think I was 'opted out' whilst with Tesco at some point. My current forecast is £157.06.

My question is as I have no real intention to work again ( my combined pensions are just below my £12K tax allowance and I top up from my lump sum) is it best to buy the 4 years back now ( I think I can do that?) in case the rules change or should I just wait until nearer state retirement time? If I was to work again does it matter how much I earn as long as I pay some NI to fill in the missing 4 years? Is there a general rule to follow?

Thanks.

molerat

Which years are not full ? Are any of them part full ?

What are all the figures from your forecast, not just the top line ?  There should be 3 or 4, some may be the same.

To get NI from employment to gain a year you need to earn 52 x the LEL which can be accumulated over a short period of time but only accumulates when you earn above the LEL with earnings below the UEL - fairly complicated.

longman27

I have checked my record and I have contributions since 1979 right through to 2020. It says my forecast is £175.20 in Oct 2029. My current forecast is £157.06 but it also says if I make 4 more years contributions I'll get the full amount of £175.20.

I've run through my payment record over the years and there are no obvious lower payments. In fact I paid £3.5K in NI last year.

molerat

If you have no gaps there is nothing to "buy back" and you can only pay going forward.  You can elect to pay class 3 by DD but if you may do some work it will be best to wait until the year is reconciled and pay any shortfall as necessary.  As long as you pay for the year in question before 2 years after the end of that year it will be the same cost. There is no need to panic buy as you have plenty of time to get the 4 years needed as there are unlikely to be any changes in that time frame and if there are there will be plenty of notice and an opportunity to correct any shortfall as with the 2016 changes which extended the 6 year NI buyback time frame to 16 years.

Do you look after grandchildren whilst the parent works ?  A good little NI earner !

longman27

Thanks molerat. I'll hang on.