Guide discussion: Voluntary national insurance contributions

patrick194

molerat said:

patrick194 said:

Just for my own peace of mind, is there a particular risk that we haven't thought of that might result in paying for years that wouldn't add to a pension?

I can imagine a scenario where I, for example, purchased the 12 available past years reaching my maximum pension and then took up employment and paid NI but wouldn't be able to increase the pension above the 35 years. I suppose one way of mitigating this risk is to only purchase years just before they are due to become unavailable?

For my partner, with a maximum of 28 years available (at this point) before retirement and 23 years required - it would surely be safe to purchase all years except the oldest 5? Of course, it does mean one then has to be sure of being able to purchase all remaining years.

Have I thought that through correctly? Or is there some other risk factor?

Thanks again

It is safe for either of you to purchase any back years.  There are limits to pre 2016 years but neither of you trip those limits.

For you, yes there is that problem of buying now and possibly paying again later for no benefit so you only "need" 2 back years as you can safely pick up the rest later.  In that scenario post 2016 years are preferable due to the slightly better return but buying the cheapest now will limit your future choice.  The other problem of buying more than absolutely necessary ahead is what I call the bus risk, step out in front of one then everything is wasted, no one gets anything if you don't live long enough.

The price of future years is effectively the same as the current year, they only increase with inflation.

Your thoughts are pretty much spot on.

Thank you molerat - that's brilliant. The "bus risk" is always at the forefront of the mind these days - the older you get the more buses there seem to be!

And thank you for addressing the price increase/inflation issue - that's reassuring.

Dodge1664

good news: we've been given a little more time

https://www.gov.uk/government/news/taxpayers-given-more-time-for-voluntary-national-insurance-contributions

jem16

What’s the bet that in July we’ll be seeing exactly the same problem as now?

JPears

molerat said:

JPears said:

Hi molerat.

Thanks for reply.

All post 2016 years fully paid up.

1985-1988 Not full

90/91 Not full

95-98 Not full

2000/01 Not full

How many total years does your NI record show as full ?

I suspect 30 ish, if so that 14-15 will add value

Whether it is worth your while with plenty spare going forward is another matter.

Once again, thanks molerat.I have 30 years full, not including 22/23.

Dazed_and_C0nfused

jem16 said:

What’s the bet that in July we’ll be seeing exactly the same problem as now?

Martin Lewis is no doubt clearing space in his calendar for a pensions special in mid to late July!

KkeithB

I have a gap of 2 weeks in my 2008-2009 NIC which forecast says I can plug but when I phoned(2022) they said would not make a difference to pension due to the change in pensions,old pension new pension(me).

I had to buy years after 2016..

I have 43years contributions but was contracted out for 22 years.

Martins comment
"one-off concession as a result of changes to the State Pension system, savers could fill in any missing years dating back to 2006/7" Does this concession change my 2008-2009 NIC year counting as a contributing year if I pay the 2 weeks or would it still be waste of money as not counting..

Sumselkb

I tried phoning again today and still cannot get through. After about 4 minutes get told lines are too busy and to phone back later.

With the deadline extended to end of July is it worth rethinking about posting a letter rather than phoning? I don't have a cheque book though, can I ask them to email me or write back with an 18 digit reference number?

MACKEM99

July 2023 or 2024?

molerat

KkeithB said:

I have a gap of 2 weeks in my 2008-2009 NIC which forecast says I can plug but when I phoned(2022) they said would not make a difference to pension due to the change in pensions,old pension new pension(me).

I had to buy years after 2016..

I have 43years contributions but was contracted out for 22 years.

Martins comment
"one-off concession as a result of changes to the State Pension system, savers could fill in any missing years dating back to 2006/7" Does this concession change my 2008-2009 NIC year counting as a contributing year if I pay the 2 weeks or would it still be waste of money as not counting..

There is a distinction between pre and post 2016 years.  You can only use an absolute maximum of 35 pre 2016 years, if contracted out generally only 30, so if you have more than those limits adding more will not add anything to your pension.  Your NI record purely shows the state of your contributions, it says nothing of how they will affect your pension.

BrookMole

I wrote to PT Operations on the 14th January this year detailing which years I wished to make up the shortfall and requesting the 18 character reference number that is needed. Two months later, I have not had  reply and the letter was sent recorded delivery.

After seeing Martins program this week, I have phoned the Future Pension Centre over 20 times.
Each time after going through the recorded message pre amble and selecting the options, the call just blips and cuts off.

The process seems entirely broken - Martin, can you apply any pressure to simplify and resolve this process?
Why do  we have to apply for an 18 reference digit number? why can't we just quote our NI number on the website and pay?