Pension forecast confusion

anonmoose

I am also very confused with my forecast.  It says I have 26 years of contributions and 22 years to contribute until pension age.  It says 3 years I didn't contribute enough although confused as why when one of those years I was at uni and one year I had a baby so thought those 2 would be covered.  The other year was covid when I didn't claim govt support but didn't have an income.

Anyway my calculation says I need another 6 yrs to get full state pension.  Can this be correct?? as that would only be 32 years of full contributions in total!  I am really worried they have made a mistake and I will find out later this is incorrect.  I do plan on working for the next 8 - 10 yrs so hopefully should be fine but I can't understand why I would need just 32 yrs contribution when someone else might need 40yrs.  Most of the years I was employed but for several years I was employed and self employed so don't know if I overpaid NI and that has any impact on it.

They don't make it easy to understand do they.  Can anyone shed light on if my forecast sounds correct.

And sorry to jump on Capt slogs thread but I didn't want to start another SP thread.

molerat

anonmoose said:

I am also very confused with my forecast.  It says I have 26 years of contributions and 22 years to contribute until pension age.  It says 3 years I didn't contribute enough although confused as why when one of those years I was at uni and one year I had a baby so thought those 2 would be covered.  The other year was covid when I didn't claim govt support but didn't have an income.

Anyway my calculation says I need another 6 yrs to get full state pension.  Can this be correct?? as that would only be 32 years of full contributions in total!  I am really worried they have made a mistake and I will find out later this is incorrect.  I do plan on working for the next 8 - 10 yrs so hopefully should be fine but I can't understand why I would need just 32 yrs contribution when someone else might need 40yrs.  Most of the years I was employed but for several years I was employed and self employed so don't know if I overpaid NI and that has any impact on it.

They don't make it easy to understand do they.  Can anyone shed light on if my forecast sounds correct.

And sorry to jump on Capt slogs thread but I didn't want to start another SP thread.

Yes it is quite possible for someone to reach the max in under 35 years.  Those that take longer have usually been in a contracted out pension scheme and have not earned much additional pension pre 2016.

Post up ALL the figures from your forecast including how many pre and how many post 2016 years held and someone will sense check it for you. Being at uni does not give you NI credits, a popular misconception.  If claiming child benefit you should have received class 3 credits.  If you are self employed with a low income you would have needed to pay voluntary class 2.  Only 3 gap years with so many years left to SP age does not present a problem.

p00hsticks

anonmoose said:

I am also very confused with my forecast.  It says I have 26 years of contributions and 22 years to contribute until pension age.  It says 3 years I didn't contribute enough although confused as why when one of those years I was at uni and one year I had a baby so thought those 2 would be covered. 

You don't get NI credits for being at university. If you turned 18 before 2010, then you should have got credits for the three years you turned 16, 17 and 18.

You also don't get NI credits for having a baby. However you do get them if you are claiming Child Benefit for that baby, from birth until they reach 12 years of age.

anonmoose said:

Anyway my calculation says I need another 6 yrs to get full state pension.  Can this be correct?? as that would only be 32 years of full contributions in total!  I am really worried they have made a mistake and I will find out later this is incorrect.  I do plan on working for the next 8 - 10 yrs so hopefully should be fine but I can't understand why I would need just 32 yrs contribution when someone else might need 40yrs.  Most of the years I was employed but for several years I was employed and self employed so don't know if I overpaid NI and that has any impact on it.

They don't make it easy to understand do they.  Can anyone shed light on if my forecast sounds correct.

Yes it can be correct. It suggests that prior to 2016 you were contracted in and accumulated some additional state pension (SERPS or S2P) over and above the state pension.

If in doubt, contact the Fuure Pension Centre to get them to confirm this.  

 

https://www.gov.uk/future-pension-centre

xylophone

The calculation done for you at 6/4/16

NI years/30 x £119.30 + (Additional State Pension -  Deduction for Contracting Out if applicable).


(NI years/35 x £155.65) - ( Contracted Out Pension Equivalent if applicable).

The higher of the two was your starting amount.

It was less than a full  new state pension and you were only in your late thirties, so many years short of SPA.

The difference between your starting amount and a full NSP enabled a calculation of how many years you would need contributions/credits to reach a full new state pension.

For example, a forty five year old with twenty five years of contributions and  a starting amount  of  £120 as at 6/4/16 would have needed to contribute around another eight years to reach a full new state pension.

If working and earning the relevant amount he would still need to pay NI after he reached full NSP but it would not improve his position any further.

See https://assets.publishing.service.gov.uk/government/uploads/system/uploads/attachment_data/file/181237/single-tier-pension-fact-sheet.pdf

anonmoose

I don't think its serps as it says on my forecast the max I can get is £185.15 if I contribute another 6 years before 2043.  It says now my estimate is £156.67.  So it sounds like it is straightforward then I just thought you needed to contribute 35yrs plus so was worried they had made an error.  

And I guess there is no point paying for the covid year as if for any reason I had to stop work in the near future you can pay the previous 6 yrs so I would just be able to make a voluntary contribution if necessary to top me up the final 6 yrs. 

anonmoose

And yes I was contracted in throughout employment pre 2016 and have had the last 10 yrs self employed of which around 5 yrs I was part time employed as well as self employed.

I have 22 full years prior to 2016 and 4 full years post 2016

QrizB

anonmoose said:

And yes I was contracted in throughout employment pre 2016 and have had the last 10 yrs self employed of which around 5 yrs I was part time employed as well as self employed.

That explains it, then.

Pre-2016 when you were contracted-in you'll have been earning ASP credits which, per xylophone's first calculation, will have increased your starting amount. Meaning your 2016 amount will have been greater than just the "number of years" you're expecting, and you need fewer years after 2016 to earn your full NSP.

Dazed_and_C0nfused

QrizB said:

anonmoose said:

And yes I was contracted in throughout employment pre 2016 and have had the last 10 yrs self employed of which around 5 yrs I was part time employed as well as self employed.

That explains it, then.

Pre-2016 when you were contracted-in you'll have been earning ASP credits which, per xylophone's first calculation, will have increased your starting amount. Meaning your 2106 amount will have been greater than just the "number of years" you're expecting, and you need fewer years after 2016 to earn your full NSP.

Has the next State Pension age review been announced 😱

QrizB

Dazed_and_C0nfused said:

Has the next State Pension age review been announced 😱

Lol yes, no-one gets to retire until they're 190

OK, I'll fix the typo. And the one I made in this post too.

Thrugelmir

squirrelpie said:

Thrugelmir said:

MSE has a guide

https://www.moneysavingexpert.com/savings/state-pensions/

Yes but it's wrong! It's another place that propagates this 35-year myth. So why link to it?

Report the article to the powers that be then.......... little point in questioning me as I haven't read it. Be proactive. Otherwise it simply becomes an endless query that will arise.