Martin's advice on buying back NI years

Brian3357

Is it wise to encourage people to spend over £825 on boosting state pensions when the government may well target the state pension? After all pensioners are not "working people" and therefore fair game

Nebulous2

I'm afraid this is an example of taking overheated speculation from the press and applying a blow torch to it. 

Buying extra years, if they are ones that make a difference, is one of the best investments many people will ever make. 

If you are that worried you can always hold off until after the budget. 

Ayr_Rage

Until we know of any changes buying missing years still offers a very good return.

Your topic is premature.

Brian3357

Let's hope. Maybe waiting unt after the budget before parting with money makes sense 

Moonwolf

Of course is it just as likely that the incredibly generous buy back option is changed so the number of years you can buy is reduced or it costs more, in which case waiting has made things worse.

As we have no idea, probably best to do what you were going to do anyway.

bjorn_toby_wilde

Moonwolf said:

As we have no idea, probably best to do what you were going to do anyway.

This 100%

In fact, copy and paste into all the other speculation based posts.

hallmark

A reasonable question IMO and a good reason why pension rules should be relatively sacrosanct and rarely if ever changed. And only then in extreme circumstances.

Constantly moving pension goalposts is utterly dreadful policy.

Brian3357

Fair comments. Usually any alterations in cost of NI years or the number of years is changed in April annually. Hopefully giving people time to decide 

bjorn_toby_wilde

They haven’t moved any goalposts yet. That’s the point.

Speculation is just that and shouldn’t be the basis of decision

molerat

It would mean moving the goalposts to a completely different stadium to have any effect on whether buying NI top up years is a good or bad decision.  The only goalpost I hope they move is to remove the ability to pay class 2 voluntary contributions going forward, there is no longer any sensible reason for them to exist.

hugheskevi

There is a reasonable point to be made that purchasing extra years is likely to be good value, but is also potentially a very risky decision. The level of risk is significantly lower for older individuals than it is for younger individuals. That isn't anything to do with Budget 2024 in particular, just the inherent level of policy change risk.

There is always a risk of policy change in the calculation of State Pension entitlement, given it is a benefit. For example, it could be made universal, or the number of qualifying years could be increased or decreased, both of which have happened in the relatively recent past. None of these seem likely now, but some Minister will feel the need to reform State Pension again at some point in the future.

For someone fairly close to State Pension age the risk of policy change is limited. But for someone aged, for example, 30, then four decades of potential political change gives a decent chance that the decision to purchase extra years will end up being a complete waste of money.

This risk can be managed by only purchasing extra years as late as possible in life, taking into account the number of years needed under current policy and the period over which past years can be purchased.