Filling NI contributions gaps to retire early

butter_fly

I am projected to have max state pension provided I'll pay contributions for the next 15 years (no idea how it works, as there is no way I'll have 35 years of contributions by 2039)

I've got a couple of gaps 2011/2012 and 2010/2011. I don't intend to work all 15 years from now, and I just wonder would it make sense to pay for 2 missing years to reduce number of future contributions from 15 years to 13 years? I don't know whether it works like that.. Thank you.

molerat

Answer the below to get the full picture

Number of full NI years 15-16 and earlier
Number of full NI years 16-17 and later
Any COPE amount.  If you have "You've been in a contracted-out pension scheme" on your forecast then click
here https://www.tax.service.gov.uk/check-your-state-pension/account/cope whilst logged into your tax account

Are those gaps full price or part filled (less than £824.20) ?

It could be that purchasing those 2 years + 13 would leave you just short of the full pension.

Devongardener

You won’t be able to claim the state pension until you reach state pension age, currently 66 but will be 67 from 2036, even if you have paid all the required years before then.

butter_fly

Devongardener said:

You won’t be able to claim the state pension until you reach state pension age, currently 66 but will be 67 from 2036, even if you have paid all the required years before then.

Yes, I'm aware of that. The purpose of this exercise merely to reduce number of future contributions.

butter_fly

molerat said:

Answer the below to get the full picture

Number of full NI years 15-16 and earlier
Number of full NI years 16-17 and later
Any COPE amount.  If you have "You've been in a contracted-out pension scheme" on your forecast then click
here https://www.tax.service.gov.uk/check-your-state-pension/account/cope whilst logged into your tax account

Are those gaps full price or part filled (less than £824.20) ?

It could be that purchasing those 2 years + 13 would leave you just short of the full pension.

So far I have 15 full NI years. No contracted-out. The gaps are full price £824.20

p00hsticks

In your shoes, I wouldn't bother filling those gaps, for a few reasons.

For esoteric reasons, pre-2016 years may not increase your forecast amount by as much as post-2016 years, they're no cheaper, you still have enough time going forward to reach the maximum, and buying now means the money will be wasted if it turns out those years are unnecessary for any reason (e.g. you don't retire early, you can get credits for soem reason after retiring, or you die before reaching SPA).  . 

You may want to retire early, but while you are working you are continuing to add years, and you may end up being able to get credits some other way if not working Stick the money you'd spend on filling them into a savings account instead.

butter_fly

p00hsticks said:

In your shoes, I wouldn't bother filling those gaps, for a few reasons.

For esoteric reasons, pre-2016 years may not increase your forecast amount by as much as post-2016 years, they're no cheaper, you still have enough time going forward to reach the maximum, and buying now means the money will be wasted if it turns out those years are unnecessary for any reason (e.g. you don't retire early, you can get credits for soem reason after retiring, or you die before reaching SPA).  . 

You may want to retire early, but while you are working you are continuing to add years, and you may end up being able to get credits some other way if not working Stick the money you'd spend on filling them into a savings account instead.

I particularly like your argument "or you die before reaching SPA"   But you're right, we tend to over worry about the future that might not ever happen..