State Pension > Unsure Whether To Top-Up 1 Year or Not...

kempiejon

scoot65 said:

kempiejon said:

For future years the better plan currently might be to start a small trading firm, register for self employment and keep profits low and pay class 2 which is much less than voluntary catch up rates £150 vs £800.

AIthough a good option, I have no idea how to do any of that as I've never been self employed / had a business etc. 

Anyway, many thanks for all the replies. Very much appreciated!

It is a good idea isn't it. Perhaps worth your wife exploring it. My rough sums suggest paying about £150 a year for the next 10 years can lift her annual pension from £4k to £7k forever so it pays for itself in just a year. Perhaps as you don't know how to be self employed she could work it out. Do you think registering as self employed is too difficult for your wife, perhaps the two of you could research it? It looks she'd be much better off.

molerat

kempiejon said:

............ My rough sums suggest paying about £150 a year ....................

It hasn't been as low as £150 since 2017, £182 for 25-26.

kassy64

I'm in the same boat. I need to pay 1 additional year of NI to get full state pension (I was contracted out during my civil service career). I checked again today and the charge is £907 for the extra year, for me to gain £5.17 per week at my SP age of 67, minus income tax so net weekly gain of £4.14. At those rates it would take me just over 4 years to be 'in profit'. I posted a while back asking what would board members do, and majority were in favour of paying for the added year. see below:
https://forums.moneysavingexpert.com/discussion/6589516/what-would-you-do/p1

kempiejon

molerat said:

kempiejon said:

............ My rough sums suggest paying about £150 a year ....................

It hasn't been as low as £150 since 2017, £182 for 25-26.

Ah, thanks for the catch, I was too idle to check, still the reasoning holds the actuals for voluntary class 2 NICs at £182 per year are lower than the quoted £824 to make up a missing year and I think count the same for the pension.