Topping up National Insurance Contributions – Is it worth it?

Helimad

My wife is 67(July 55) and in good health. She currently has 37 state pension qualifying years. We have checked with the Department of Works and Pensions and she can purchase another 5 years contributions at a total of £4092.40. This would increase her state pension from £161.44 per week to £185.15 per week. An increase of £23.71 per week. Therefore I believe we would  start benefiting in 3.31 years.

Should we keep the money invested in savings or purchase the extra years? What would you do?

oldernonethewiser

I would buy the extra years.

(and have done)

molerat

4 years will give £5.29 each and the 5th £2.55.  Well worth it.  Buying an annuity with that money would give you something £3.15 a week, quite a difference.

badmemory

Also the state pension increases are higher than savings interest rates.  10.1% increase in April will more than make up for current interest rates.  You may need to hurry for 2016 though, I'm not positive about that but you should check.

Stubod

..for me it's a no brainer, we have been buying extra for the last few years and will only stop when we have reached "the max"..

Scrudgy

We bought 8 years for my wife to give her the full state pension. Well worth it, payback is quick in years and guaranteed income.