Take State Pension or defer - general principle

seven-day-weekend

Yes, I too will be taking my pension weekly insyead of monthly when I can draw it in 2010.

chesky369

Like Newly Retired, I also deferred taking my state pension whilst I remained working. If you are still employed you're actually quite well off during this period, since you don't pay NI contributions. I'm delighted to have additional weekly income now going straight into my savings account, building up a nice little sum. The only cloud on my horizon is that the tax people seem unable to get their sums right - I've now had four different codings since February, all of them WRONG.

Be_Happy

Deferring depends so much on individual circumstances. In my case I've deferred because my need for extra money in the future is more important than my need for income now. My husband is a good bit older than me. We live comfortably on his RAF pension, but if he dies before me, his pension dies with him, so I would need more of an income.

Re the fear of losing the deferred amount, if you die while deferring, your spouse/civil partner gets an increased pension or lump sum to make up for the amount deferred, so all is not lost in that case.

tanith

I too had this dilemma but have now decided to take the pension when I turn 60 in July, I figured you never know whats round the corner and as I then have to choice to invest it or spend it .
I have also opted for it to be paid weekly thanks to info from this site..:T

boobbby

Be_Happy wrote: »

Deferring depends so much on individual circumstances. In my case I've deferred because my need for extra money in the future is more important than my need for income now. My husband is a good bit older than me. We live comfortably on his RAF pension, but if he dies before me, his pension dies with him, so I would need more of an income.

Re the fear of losing the deferred amount, if you die while deferring, your spouse/civil partner gets an increased pension or lump sum to make up for the amount deferred, so all is not lost in that case.

You should get 1/3 or 1/2 of an RAF pension depending how he set it up.

moonrakerz

Primrose wrote: »

Busy builder --The scandal with the State Pension scheme is that however much you've paid into it via your National Insurance contributions, if you die, the pension dies with you and your spouse/nominated partner doesn't get a penny,

The bigger scandal is that most people believe that they are paying into a "pension pot" for their future retirement.
Regrettably they are not, every penny you pay in now is spent in supporting present day pensioners, that is why your widow/widower gets nothing - there is nothing !

You only have a proper pension fund if you pay into a private scheme - and of course the first thing Gordon Brown did in 1997 was to help himself to a large chunk of that as well !

EdInvestor

moonrakerz wrote: »

Regrettably they are not, every penny you pay in now is spent in supporting present day pensioners, that is why your widow/widower gets nothing - there is nothing !

As mentioned, this isn't correct. Widow/ers receive up to 100% of SERPs/S2P entitlement and anyone receiving a 60% pension based on the deceased spouse's contributions has the amount upgraded to 100%.

Oh and BTW, currently ALL ex wives can claim a 100% spouse's state pension on the basis their ex husband's NI contributions.

When you consider that you would have to save up between 150k and 160k to buy an equivalent pension to the basic state pension on its own (never minds SERPS), you can see it's a very valuable benefit.

People who think it's worthless are simply ignorant of the facts.

moonrakerz

EdInvestor wrote: »

As mentioned, this isn't correct. Widow/ers receive up to 100% of SERPs/S2P entitlement and anyone receiving a 60% pension based on the deceased spouse's contributions has the amount upgraded to 100%.

Oh and BTW, currently ALL ex wives can claim a 100% spouse's state pension on the basis their ex husband's NI contributions.

When you consider that you would have to save up between 150k and 160k to buy an equivalent pension to the basic state pension on its own (never minds SERPS), you can see it's a very valuable benefit.

People who think it's worthless are simply ignorant of the facts.

Before you spout off, perhaps you should read the quote to which I was responding. My response is perfectly correct: -there is no "pension pot" - pensions being paid today come out of taxes being paid today.

I made no comment about entitlement to widow's pension/SERPS/S2P etc, etc. The comment I made was there is no "pot" of accrued money which widows/widowers are entitled to. Whether there is, or isn't, a separate pension available to these people is not relevant to the original point raised.

Please read what was there, not what you thought was there !

Be_Happy

boobbby wrote: »

You should get 1/3 or 1/2 of an RAF pension depending how he set it up.

Sorry boobbby not in our case. Husband left RAF in 1977 after 30 years' service, but he divorced in 1980 and we met and married in 1985, so, although we've been married 23 years his pension doesn't pass on to me.

boobbby

Be_Happy wrote: »

Sorry boobbby not in our case. Husband left RAF in 1977 after 30 years' service, but he divorced in 1980 and we met and married in 1985, so, although we've been married 23 years his pension doesn't pass on to me.

Well that put me straight!! there I was thinkin as an old fool I would marry a nice 18 year old girl and set her up with a pension after I was gone. Just as a matter of interest is the pension always lost after a divorce and you are no longer in the service.