Mid-40s and only have 8 years; missing years not all showing up as payable

i_like_cats

I only have 8 years towards the state pension, all before 2016.  My forecast is £86.43 a week .

My statement says I can now pay 2008-2009, 2009-2010, and 2013-2014. The amounts are £776, £824 and £824.

However I also haven’t paid for the following years, and it doesn’t currently give me the option to pay them.  I have requested a callback from HMRC, but I didn’t try to call them first:

2010-2011
2012-2013

2016-2017
2017-2018
2018-2019
2019-2020
2020-2021
2021-2022
2022-2023

2023-2024 (should be partial year as I just made part-payment for 5 month period of self-employment, then was on UC for final 3 months).

I know it’s a mess!  I was often effectively unemployed but not claiming jobseekers or UC, instead getting just Housing Benefit and being supported by my parents and a small income from self-employment.  I still should have paid voluntary class 2s and it’s just stupidity that I didn’t.

Anyway - am I right in thinking that the more recent years should be cheaper to pay than the older ones?  And that when I get to speak to HMRC, they will update my account to give figures for these years, too?

I guess there is no point paying the 2008, 2009 and 2013 years (plus 2010 and 2012 if possible), and instead I should focus on all of the 2016 years?  Or because of the change from the old to the new state pension, it’s actually also worthwhile paying those 5 years that are pre-2016 (two which haven’t been calculated yet), because then I’ll benefit from the triple lock - if it still holds in 22 years time when I’d reach state pension age.

Also - I have about £400 (yes, that’s the total pension pot!) in an Aviva pension that was set up in a job I had that was abolished at the end of my probation period (company shut down that department). So I could in future pay into that if my financial situation improves.

Thanks for reading

molerat

I assume those years are showing as "checking", usually down to you being registered as self employed and not paying class 2.  To get them "unlocked" you will need to call HMRC, there is no other way to give you a chance before the cut off.

Older years are cheaper than most  new years because of the way the prices increase and in 2023 a hold was put on the increase for the older years.

All years up to 19-20 are £824.20, 20-21 at £795.60, 21-22 at £800.80, 22-23 at £824.20 (when the price of old years was locked), 23-24 and 24-25 at £907.40 and 25-26 at £923 (the price which years 19-20 to 22-23 will increase to from April).

You have got another 22 years so looks like you could just scrape a full pension going forward - the forecast top box should state the amount you could possibly receive, but all of those available years will add to the pension.

i_like_cats

Thanks, molerat.  Yes, that’s right.  Those years show as "We are checking this year to see if it counts towards your pension. We’ll update your record when this is finished, you do not need to do anything.”

I will call HMRC.

So would you say it is worth paying those three years for £2.4k now, or am I better off just making sure I have stable employment from now on?  (By no means a given - but, I also don’t really expect I’ll live beyond 80).

There will have been some years where I wasn’t self employed or working, just supported by parents & living cheaply.  Will it be possible to get those unlocked too? 

Another thing I noticed is that the years I did my A-levels show as full years.  So does the first year I was at university.  That will be the 3 years for which I got national insurance credits.  The other 2 years of my degree show as ‘Year is not full’. Obviously I’m not suggesting the government would ever have paid anyone’s contributions while they took higher education, when workers had to pay theirs.  But I don’t remember at the time it being suggested I should be paying national insurance while at university….

molerat

Prior to 2010 you got 3 freebie years for being 16, 17 and 18. Generally you don't need to pay NI whilst at uni because you will have enough going forward - say 22 to 66 is another 42 years to get the necessary amount, pre 2010 you would have needed them all !

All those locked years are because HMRC think you were self employed and should have been paying class 2 with no other contribution streams to say otherwise so it is likely they will unlock them all.

Does your forecast show £221.20 in the top box ?

Is 23-24 showing on your record yet ?

If you were actually self employed for some of those years you could be entitled to class 2 rates and going forward would you be self employed ?

Tough decision to make on paying those full priced years though, one that only you can decide.

i_like_cats

Have they changed it now so that the freebie years start at 18?  It would make sense for them to, because so few people leave school at 16 these days!

Yes here’s what my forecast says: "Your forecast is £221.20 a week, £961.83 a month, £11,541.90 a year.”
I become eligible for it in 21 years.

Apart from some long-vanished types of work I had in the 2000s and 2011-2012, my self-employment was never anything that made much money, just a few hundred pounds a month.   A combination of cheap rent, full housing benefit, and help from parents, kept me going.

For the more recent years like 2020, 2021, 2022, will it cost vastly more to pay the class 2s now, than it would if I’d done so when I submitted my self-assessment returns?   Costly mistake by me if so!

molerat

Class 2 is only £182 for 25-26 so not a huge increase.  The forecast only ever gives the more expensive class 3 price.

QrizB

i_like_cats said:

Have they changed it now so that the freebie years start at 18?  It would make sense for them to, because so few people leave school at 16 these days!

I don't think there are any freebies any more.

i_like_cats said:

Yes here’s what my forecast says: "Your forecast is £221.20 a week, £961.83 a month, £11,541.90 a year.”
I become eligible for it in 21 years.

Nothing about improving your forecast? If not, then the system seems to think that you can get a full pension with 23-24 plus the next 21 years, without buying any previous years.

Do you expect to be paying NI or getting credits from now until State pension age?

i_like_cats said:

For the more recent years like 2020, 2021, 2022, will it cost vastly more to pay the class 2s now, than it would if I’d done so when I submitted my self-assessment returns?   Costly mistake by me if so!

If HMRC agree that you are eligible to pay Class 2s, you'll pay the current Class 2 rate (rather than the rate that applied in those years). That's still a bargain when compared to Class 3s.

p00hsticks

i_like_cats said:

Have they changed it now so that the freebie years start at 18?  It would make sense for them to, because so few people leave school at 16 these days!

No. The 'freebie' years for 16. 17 and 18 year old were given when far more NI years were required to get the full ('basic') state pension - 44 years for a male (when their State Pension Age was 65) and 39 for a female (who reached SPA at 60) -  which would have made it difficult for those staying in full time education to reach the target.  

They were done away with in 2010 when the number of years needed was reduced, and so there was more opportunity to obtain the requisite number of years after leaving full-time education.