Part time work and state pension?

Nico60

I have been going through my wife’s pension forecast, and it shows on the government state pension page she has full years of contributions but then when I go into the ‘how much she has paid for the year’ some of the years show just a few pounds paid ie £9.48 £3.60 does this still qualify her for full state pension as she was only just over the threshold for paying national insurance.

Janie2008

As long as it says full it doesn't matter what it says.

Dazed_and_C0nfused

You don't have to pay NI to gain a qualifying year.

The LEL is crucial, currently £123/week.

So 52 weeks earnings £123/week would do it.  Plus millions of other permutations.

p00hsticks

Nico60 said:

I have been going through my wife’s pension forecast, and it shows on the government state pension page she has full years of contributions but then when I go into the ‘how much she has paid for the year’ some of the years show just a few pounds paid ie £9.48 £3.60 does this still qualify her for full state pension as she was only just over the threshold for paying national insurance.

If it says that the 'year is full' then yes it will count towards her state pension. Once you earn above the 'lower earnings limit' (currently £123 a week) you get credited with NI for the week, but you don't actually pay any NI until you reach the 'Primary Threshold' (currently £190 a week). 

Just look out for any cases where the year shows as being only partially filled, as these won't count (even if just one week short) unless you voluntarily pay to make it up to a full year. 

Nico60

Thank you all, I thought full meant she was up to date, but then when I read it saying only so much had been paid I thought she needed to make it up. 

Thank you again.

xylophone

What exactly does your wife's state pension forecast show?

https://www.gov.uk/check-state-pension

Oddballs

Nico60 - Sorry for jumping in on your chat 
I've just checked my wife's forecast and I think her situation may be similar 
She worked as an NHS nurse until she took her NHS pension at 56 in 2016
Her NI record shows 40 years of full contributions but her estimated state pension is only £161.17 
She's not made any extra contributions since retiring 
I thought you only needed 35 years for a full pension.

Dazed_and_C0nfused

Oddballs said:

Nico60 - Sorry for jumping in on your chat 
I've just checked my wife's forecast and I think her situation may be similar 
She worked as an NHS nurse until she took her NHS pension at 56 in 2016
Her NI record shows 40 years of full contributions but her estimated state pension is only £161.17 
She's not made any extra contributions since retiring 
I thought you only needed 35 years for a full pension.

The 35 years rule only applies to those starting to pay NI from 2016.

Your wife is under transitional rules and is a guaranteed winner!

She can do nothing and get the pension she was always entitled to.

Or pay some incredibly good value voluntary NI and get an enhanced State Pension of £185.15/week.

If she pays for 5 post 2016 years she will add £23.98/week to her State Pension.  Which equates to £1,246.96/year.  Which in real terms will be £997.56 after tax, payable from State Pension age for the rest of her life.  And in a month's time is increased by 10.1% from the triple lock.

The first four years she buys will each add £5.29/week with the fifth adding the final £2.82/week as she reaches her personal maximum of £185.15/week.  So that fifth year is not quite as good value as the first four but still worth doing compared to any other investment she could make.

molerat

Oddballs said:

Nico60 - Sorry for jumping in on your chat 
I've just checked my wife's forecast and I think her situation may be similar 
She worked as an NHS nurse until she took her NHS pension at 56 in 2016
Her NI record shows 40 years of full contributions but her estimated state pension is only £161.17 
She's not made any extra contributions since retiring 
I thought you only needed 35 years for a full pension.

If she had got a forecast before April 2016 she would have been told her pension was around £135, £119.30 basic pension plus £16 additional pension. That is what she would have expected to get when she left work early and there was no way to increase that except by further working.   Along comes April and her entitlement under the new scheme would, I expect, be around £85, you don't get something for nothing in this world, but she kept her entitlement to what she already had.  She, like many of us, is a winner under this new arrangement because she now has the opportunity to increase that pension to £185.15 by buying additional years.  The task now is to read up on exactly what she needs to do to bring that pension up to the full amount, you will get loads of help here.

xylophone

Your wife retired from paid employment in 2016 at the age of 56 and has no NI "qualifying years" since then.

it would appear that for much or all of her working life she was a member of a contracted out pension scheme.

https://techzone.abrdn.com/public/pensions/Tech-guide-contracting-out#:~:text=Contracting out was a method,SERPS) for particular tax years.

When she retired, she had 40 qualifying years.

2016 saw the introduction of New State Pension.

On 6/4/16, two calculations were done to establish your wife's  "starting amount" for NSP.

It was the higher of  her old/new rules entitlements.

Old Rules

NI years/30 (max) x £119.30 (Full Basic) + ( Additional State Pension  - Deduction for Contracting Out).

New Rules

{NI years/35 (max) x £155.65 (Full NSP)} - Contracted Out Pension Equivalent.


In your wife's case, the old rules would have given the higher entitlement.

Her entitlement was less than a full NSP and she had a number of years to go before she reached SPA.

 Qualifying years post 6/4/16 and up to the year before the one in which she reached SPA would  improve her starting amount up to (but not in excess of) a full NSP.

She was not contributing/receiving  credits post her retirement in 2016 but does have the opportunity to increase her state pension by making voluntary contributions ("buying" the appropriate number of years post 6/4/16).

https://www.dpf.org.uk/explorer/files/TOPPING-UP-YOUR-STATE-PENSION-GUIDE.pdf produced by Royal London as an aid to  understanding NSP might be of interest - also the Govt's attempt at the same

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

What exactly does her forecast show?

https://www.gov.uk/check-state-pension

Nico60

Oddballs said:

Nico60 - Sorry for jumping in on your chat 
I've just checked my wife's forecast and I think her situation may be similar 
She worked as an NHS nurse until she took her NHS pension at 56 in 2016
Her NI record shows 40 years of full contributions but her estimated state pension is only £161.17 
She's not made any extra contributions since retiring 
I thought you only needed 35 years for a full pension.

No probs, my pension on gov site states I’ve paid 47 full years and have to pay 3 more to qualify for my full state pension, at the moment I’m looking at £171.?? and if I pay 3 more years £185.?? I’m not sure the government know what they are doing to be honest, but I hope my wife will get her full whack too when it comes time for her to ‘officially’ retire.

P.s. I hope it all goes well for your wife’s pension too.