47 yrs =?

Gambo47

Yesterday I looked at my pension forecast as I will be able to "claim" my state pension from Nov this year. 
I know one of my employers was opted out for a number of years but the ukgov site shows that my contributions are for 47 years means my state pension would currently be £220.22 a week based upon the website national insurance contributions (the current max is £221.20). I no longer work and to reach the maximum I'd have to pay around £1700 for last year and this year.
Yesterday I saw that the rise in 2025/6 state pension is £470 per annum so does this mean I'm still capped at £220.22 in November or do I need to hand over £1700 national insurance contributions in order to get the £470 increase making it more worth while? It wouldn't be worth it for the 98p weekly difference at the moment.
My other worry is that the forecast is wrong and because of opting out for 17 years I'm way short of what needed.
Thank you for any advice. 

Triumph13

Firstly, don't worry, you will get your triple lock increase, just like everyone else (unless you emigrate to a country where it doesn't increase.)

Secondly, you definitely wouldn't need to pay £1700.  You would only need a single year of voluntary NIC to get to the full amount as each post 2016 year is worth 1/35th of the full pension.

As to whether it's worth it for 98p a week, maybe, maybe not.  Particularly if you will have enough overall income to be paying tax on that extra 98p.

p00hsticks

Firstly, to avoid confusion you mean 'contracting out' (of the state SERPS / S2P additional pension schemes prior to  2016) rather than 'opting out' (which is where you choose not to continue being to an employers private pension scheme). 

For state pension purposes, years where you were contracted out count as full years exactly the same as years where you were contracted in. As you have found, the difference is that, due to the transitional rule calculations done when the new state pension was introduced, those who were contracted out (and therefore paid a lower rate of NI and did not build up any SERPS/S2P) tend to require more years to reach the maximum amount. 

Is that £220.22 what you are currently entitled to as at April 2024 or what you might be able to get if you make further contributions ? Your state pension forecast should give both values 

If the former, in my view there is little point in buying any additional years as an extra year will only add the 98p to take you up to the maximum, so it would take a long time to break even on the investment.

Your forecast amount will increase in line with the State Pension rise in April, there is no need to make further NI payments for it to reflect the annual increase.   

Linton

Gambo47 said:

Yesterday I looked at my pension forecast as I will be able to "claim" my state pension from Nov this year. 
I know one of my employers was opted out for a number of years but the ukgov site shows that my contributions are for 47 years means my state pension would currently be £220.22 a week based upon the website national insurance contributions (the current max is £221.20). I no longer work and to reach the maximum I'd have to pay around £1700 for last year and this year.
Yesterday I saw that the rise in 2025/6 state pension is £470 per annum so does this mean I'm still capped at £220.22 in November or do I need to hand over £1700 national insurance contributions in order to get the £470 increase making it more worth while? It wouldn't be worth it for the 98p weekly difference at the moment.
My other worry is that the forecast is wrong and because of opting out for 17 years I'm way short of what needed.
Thank you for any advice. 

To avoid confusion the employers pension would have been "contracted out" , "opted out" means something rather different.

The government website shows your accrued SP as of now, not what it will be when you take it.  It will be increased in line with the triple lock in April so you dont need to pay anything extra.

Gambo47

Thank you for your help, much appreciated. 
The figure I quoted at £220.22 a week is based on my current state of the contributions. So you all confirmed my initial thoughts that it's not worth paying any more than I have already over 47yrs as the 98p a week would take more than what's left of my life to break even.
You have also stopped me from worrying about the new rate announced yesterday. 
It won't make up for all the rises in heat light and council tax etc but it certainly helps. 

LHW99

Don't know how long you would have to do it, but you could defer claiming the SP for 9 weeks, I think that would bring you up to slightly more than the maximum £221, and 9 weeks is not overlong to wait, unless you have no other resources. (I think 9 weeks is the minimum you can do)

Aretnap

Gambo47 said:

So you all confirmed my initial thoughts that it's not worth paying any more than I have already over 47yrs as the 98p a week would take more than what's left of my life to break even.

Would it? At £907 for a year's Class 3 contributions it would take you about 18 years to break even - which is a year less than the life expectancy of a 66-year old man. And over that time period it will rise with or faster than inflation, which cash in the bank probably won't.

If you have other income then you might have to pay tax on the extra, which does skew the calculations a bit. Overall it's marginal or perhaps not worth doing - but it's not a complete no-brainer, especially if you are in good health for your age.

Blue_Butterfly

Have you been looking after one or more grandchildren whilst their parent works, or an elderly or disabled person?
If so you may be able to apply for free NI credits for the one year you are short of the maximum.

Notepad_Phil

LHW99 said:

Don't know how long you would have to do it, but you could defer claiming the SP for 9 weeks, I think that would bring you up to slightly more than the maximum £221, and 9 weeks is not overlong to wait, unless you have no other resources. (I think 9 weeks is the minimum you can do)

It's definitely a possibility, but I think the OP would need to take care in working out the figures as deferring the state pension will obviously have a cost, and I think the number of weeks needed to make up the 98p (about 4 from my quick calculations) means it is not going to be too far in cost from just buying a year now (especially if they have some existing cheaper ones that they could use). There's also the consideration that the deferred amount would only rise by CPI in the future whilst the bought amount would follow the triple lock.

Cobbler_tone

It is a big stretch psychologically to cough up £907 today for a lifetime benefit of 98p (plus rises but potential tax implications, even if just on a state pension soon) a week regardless of the maths, which is totally dependant on life span. I don't think that an additional 98p is going to make a tangible difference to most people and could pay for a holiday...or you may not have the £907 to hand. 

GibbsRule_No3.

If people are still paying Tax, after receiving State and Personal Pensions is it ever actually worth paying the extra amount to make the State Pension up?  It wasn't something I had to worry about but the Tax I pay on my Pensions made me wonder.