Help please deciding whether to buy additional NI years 3 March at 4:26PM in Pensions, annuities & retirement planning 14 replies 337 views

SaintAlf

Hi, I read the thread here https://forums.moneysavingexpert.com/discussion/6429046/future-pension-centre-is-a-joke/ and saw forumites like @Poohsticks and @molerat were very helpful, we've tried the FPC but like many haven't got through yet.  Can anyone advise on whether extra payments will make a difference to the forecast and if so what needs to be paid?  The details are:

Headline amount of pension forecast ? £164
Current forecast amount as at April 2022 £148
How many years available to pay going forward 3

Number of full NI years prior to 2016 33

Number of full NI years post 2016 none

What past years are available to pay and for how much
2006/2007 £824
2007/2008 £380
2015/2016 checking
2016/2017 checking
2017/2018 £824
2018/2019 £824
2019/2020 £824
2020/2021 £796
2021/2022 £801

Whether there is a COPE amount mentioned and if so what it is (it should show a link to it if there is something along the lines of 'like many others at some point you were contracted out of the additional state pension')
Yes £26

Thanks in anticipation 

molerat

You have obviously rounded those numbers, could make a difference to the calculations., so the following is based on those given figures.

You need 8 more years to reach the max with 3 years going forward and 6 viable years going back.  Years 2015-16 and earlier cannot add to your pension.  7 years will take you to £185.03, 12p short of the max.

15-16 and 16-17 self employed ?

Dazed_and_C0nfused

SaintAlf said:

Hi, I read the thread here https://forums.moneysavingexpert.com/discussion/6429046/future-pension-centre-is-a-joke/ and saw forumites like @Poohsticks and @molerat were very helpful, we've tried the FPC but like many haven't got through yet.  Can anyone advise on whether extra payments will make a difference to the forecast and if so what needs to be paid?  The details are:

Headline amount of pension forecast ? £164
Current forecast amount as at April 2022 £148
How many years available to pay going forward 3

Number of full NI years prior to 2016 33

Number of full NI years post 2016 none

What past years are available to pay and for how much
2006/2007 £824
2007/2008 £380
2015/2016 checking
2016/2017 checking
2017/2018 £824
2018/2019 £824
2019/2020 £824
2020/2021 £796
2021/2022 £801

Whether there is a COPE amount mentioned and if so what it is (it should show a link to it if there is something along the lines of 'like many others at some point you were contracted out of the additional state pension')
Yes £26

Thanks in anticipation 

Buying additional post 2016 years will make a difference.

But what do you expect to happen going forward?  Will you add the 3 years or would those have to be bought as well (if needed)?

You have also omitted the pence from your figures.  How much have you accrued so far £148.??

SaintAlf

Thanks for the quick reply.  I expect the 3 years going forward would have to be bought if needed.  Sorry I rounded the figures, so far it's £147.69.  The gov.uk site says the amount can be increased to £185.15 and we'd like to establish what it would make sense buying, in particular before the 2023 deadline.  The advice says each post 2016 year adds about £5.29/week which suggest  7 years which seems a lot when there are already 33 full years. Also not sure of what the impact of the COPE amount of £25.69 is, and why 2 years are showing as "We are checking this year to see if it counts towards your pension.

Dazed_and_C0nfused

Seven years only takes you to £184.72.

But it could be argued buying the eighth and final year isn't good value for money as it will only add the last £0.43/week or £22.36/year (pre tax).

The COPE amount can be ignored.

Have you been self employed in the past?

SaintAlf

Yes, it's my partner, who has been self employed in recent years but without much income.  Does it explain why 2015 and 206 are "checking"?

molerat

You can reach £185.15 but it will not be worth buying the 8th as that will only give 43p, the max you can viably achieve is £184.72.  You need 7 of the available 9 years to get there.  Your need for more years is down to your contracted out time reflected in the COPE which reduced your 2016 new scheme starting amount meaning what you already had under the old scheme was higher.

What were you doing during those 2 "checking" years - self employed, on benefits ?

SaintAlf

Self employed, not on benefits

SaintAlf

It may be stating the obvious, but presumably it makes sense to include the "cheapest" year ie 2007/2008 at £380.40?  Is there any difference between the years (other than the deadline)?

molerat

SaintAlf said:

Self employed, not on benefits

That is the reason for 99% of the cases.  If you were SE at that time then you may be able to pay at class 2 rates for 16-17, £163.80 for the year, but would need to speak to someone, the big problem.

SaintAlf

molerat said:

SaintAlf said:

Self employed, not on benefits

That is the reason for 99% of the cases.  If you were SE at that time then you may be able to pay at class 2 rates for 16-17, £163.80 for the year, but would need to speak to someone, the big problem.

That's a big difference - does that apply to any years of self employment? If so I'll need my partner to be more accurate in identifying this years!