state pension

[Mice!]

You've got me thinking now, I'll have to have a look later but with 27 years till I hit retirement age which will probably be 70 plus years by then think it will just make me frown 😣

[Davyo]

If anyone wants a NIB (state pension)forecast you can log onto your PTA (personal tax account) or create one @ www.gov.uk/personal-tax-account.You will also be able to check your NIC is up to date.Also check if there are any missing NIC contributions.

 

See even though I'm part retired (sitting in my favourite cafe) I'm still working lol.

Edited June 23, 2017 by Davyo

[ips]

The thing is that its all well and good planning what your going to do at retirement age, the sad fact is that many people don't live long enough to get it or if they do they haven't the health or indeed enough money to enjoy it. Which is why ever since 1991 when my dad died I have done what I want when I want (wherever possible) just in case.

 

I was discussing the matter with the wife last night and we concluded that once you have got your 31 years or whatever it is then you should be able to start drawing some of your pension out. How much do the govt make out of people who don't get to retirement age or don't live very long after ??

[AVB]

I am told my company opted me out of full contributions for many years as I was in the in house pension scheme. I have absolutely no awareness of this happening at the time but the reduction I face now is not going to cause me grief.

 

What I would say though is the state pension is a magnificent bargain. Looking back over my old contributions, I will get back out every week roughly what I paid in each year in contributions. so that's 52-1 return.

 

In one year I will get back virtually what I paid in over my entire working life, nice for me but for the Government they need to get real and cost this out as a business not a hand out to the silver voters.

 

Blimey you must have been low paid. I also was 'contracted out' and my average (over the past 15 years) annual NI contribution was £8,000.

[Vince Green]

Blimey you must have been low paid. I also was 'contracted out' and my average (over the past 15 years) annual NI contribution was £8,000.

Yes but your NI contribution goes to fund more than just your pension. Besides I have for the past twenty odd years, on the advice of my accountant, only ever paid the basic Self Employed Class 2 NI contribution which was about £72 a quarter. I think when I started it was £26 a quarter Can't believe it myself it seems incredible

Edited June 23, 2017 by Vince Green

[Thunderbird]

I thought they stopped Class 2 contributions now and that it's all done on self-assessment?

 

EDIT: on looking into this, seems Class 2 still exists (as well as Class 4) but you don't pay that small monthly bit that you used to.

 

As least I think that's right.

Edited June 23, 2017 by Thunderbird

[AVB]

Yes but your NI contribution goes to fund more than just your pension. Besides I have for the past twenty odd years, on the advice of my accountant, only ever paid the basic Self Employed Class 2 NI contribution which was about £72 a quarter. I think when I started it was £26 a quarter Can't believe it myself it seems incredible

 

Yes it does fund more than my pension. Yours as well by look of it

[JohnfromUK]

Fund is a bad word, because actually - it doesn't fund your pension. If you lived on Norway, they take all pension contributions, invest them in a big (and in fact it is HUGE) pension fund to pay future and present pensions. Norway's pension fund owns a huge amount of worldwide business. Norway has been 'prudent' to quote a past Prime Minister who was anything but prudent) In the UK, present NI contributions pay present pensions. There is no fund, because as ever we are borrowed to the hilt. In fact, because of successive governments borrowings we all (every one of us) owe about 27,000 pounds - that our government has borrowed on our behalf. Even with present historically low interest rates, the interest on our debt is almost as big annually as the total annual defence budget. So called 'austerity has not brought it down, it has only reduced the rate at which it is increasing, but it is STILL INCREASING.

These are the very worrying facts of living in a virtually bankrupt country. This should worry everyone - especially as some (mainly the Labour party) want us to borrow EVEN MORE.

[gemini52]

I reached 65 on 22 may this year,i have 45 full years ni contributions,i get 149.89 per week,the reason they gave me being i opted out of the serps in the eighties for about five years,like many people iwas told it was the way to go,but this was not to be,it gave me a small pension pot of just over 29 grand i have took the 25% tax free and the remainder gives me a monthy pension of 145 quid,so on that basis i am around a grand a year better off,i feel that i have been penalised by the government for opting out,like many people i have paid in more than the required 35 years contributions,i am still waiting for the reason to be put in writing.

[Lloyd90]

I've got 2 years that I apparently didn't contribute enough.

 

Is it worth paying these? Apparently you can go back and make a payment of around £400 for each of those years

[toontastic]

I reached 65 on 22 may this year,i have 45 full years ni contributions,i get 149.89 per week,the reason they gave me being i opted out of the serps in the eighties for about five years,like many people iwas told it was the way to go,but this was not to be,it gave me a small pension pot of just over 29 grand i have took the 25% tax free and the remainder gives me a monthy pension of 145 quid,so on that basis i am around a grand a year better off,i feel that i have been penalised by the government for opting out,like many people i have paid in more than the required 35 years contributions,i am still waiting for the reason to be put in writing.

So you're a grand a year better off and you still whinge.

[JohnfromUK]

I've got 2 years that I apparently didn't contribute enough.

 

Is it worth paying these? Apparently you can go back and make a payment of around £400 for each of those years

I think the answer to your question depends on your circumstances - and what changes to the rules will happen before you reach your pension age; You need a number of 'complete' years to qualify for a full pension. Currently you need 30 years for 'full', but get some pension for anything over 10 years;

IF you believe that you will have a full 30 years anyway, I don't believe topping up will get you more. Also - I believe you can only top up some more recent years (older ones are 'sealed'.)

 

I also have two 'incomplete' years, from quite early in my working life - and I can't top these up. However since I have more than 30 years complete, I will get a full pension anyway (when I get to 66 in my case).

 

The problem is that they meddle with the rules so often that no one really knows much in advance what the best thing to do would be ........

Edited June 25, 2017 by JohnfromUK

[gemini52]

So you're a grand a year better off and you still whinge.

To right i paid the contributions required,i started work at fifteen and worked all my life its just any excuse to rip you off.

[toontastic]

To right i paid the contributions required,i started work at fifteen and worked all my life its just any excuse to rip you off.

But surely it was your choice to opt out of serps.

[ips]

Slightly off topic ish...

 

My personal pension isn't worth a button. My fault as I have rarely reviewed it or increased it since taking it out in 1986. I know there are many factors but to make it simple how much per month would you need to pay (or been paying) into a personal pension and for how long in order to see for arguments sake an equal amount to state pension ie £150 pw. @ 60 yrs of age

[100milesaway]

What most people don't factor in to the pension setting up is the fact that £150 now sounds like decent payback but in 40 years time it will be worth the princely sum of about £10 due to inflation. Buy some property. from Auntie.

[ips]

Exactly, when I took mine out the interest rate was very high and projection was good even if you index linked it. Because I have never really increased it much and was possibly ill advised I now find myself in a pickle. My pension is frankly not worth taking into account. I am now of the opinion that its too late to do anything about it as I intend to fully retire in four years at 57 and try to live off my savings until state pension kicks in at 67. Buying property is not something I want to do but I appreciate its possibly a good idea.

Thanks for reply

[oldypigeonpopper]

hello, if you had put the same amount of money in a private pension scheme as the part from national insurance that goes into your state pension i do not think there would be much difference maybe less , to now have any decent private pension you need at least £250,000 invested

[ips]

That sounds about right my friend...with hindsight I would have actually sat my exams at school, i have no school qualifications apart from a 10metre swimming award which funnily enough has never been of help 😁 then i would have got a propper job in civil service or forces or summat and enjoyed a propper pension with early retirement instead of the stress and darned hard work of running a business. The only thing that is a benefit is that i now only work about three days per week 👍

[Vince Green]

But surely it was your choice to opt out of serps.

I don't think that's necessarily true, in my case, many years ago my employer apparently opted me (and everybody else) out. I have no recollection of having been made aware at the time. When I queried it they said it was a fairly normal thing for an employer to do back then if you were in an in house pension scheme

[oldypigeonpopper]

That sounds about right my friend...with hindsight I would have actually sat my exams at school, i have no school qualifications apart from a 10metre swimming award which funnily enough has never been of help then i would have got a propper job in civil service or forces or summat and enjoyed a propper pension with early retirement instead of the stress and darned hard work of running a business. The only thing that is a benefit is that i now only work about three days per week

hello, i foresee those gold plated pensions will be a thing of the past in a few years, my young son runs a small business and works hard 6 days a week to give himself and 3 men work, my older son has a medical condition and cannot hold a job down, both will not have any idea of retirement like so many younger people in uk

[AVB]

Personally I would not depend on the state pension. My advice to anybody nowadays is to bung as much possible into a private pension as these are tax efficient (although less so than they used to be for high earners), and once you have used up your pension tax allowance bung the rest into an ISA. If you want to do property then fine but but imo it's a crash waiting to happen.

[oldypigeonpopper]

Personally I would not depend on the state pension. My advice to anybody nowadays is to bung as much possible into a private pension as these are tax efficient (although less so than they used to be for high earners), and once you have used up your pension tax allowance bung the rest into an ISA. If you want to do property then fine but but imo it's a crash waiting to happen.

hello, that would be the right thing but as i can see only 10/20% of our younger generation are able to do so as many are on £7/8 per hour not being able to afford to buy and paying high rents or even still living with family till ?? years. then it wont be much of a retirement for them at 67

Edited June 26, 2017 by oldypigeonpopper

[gemini52]

But surely it was your choice to opt out of serps.

The law states at the moment you need 35 full years contributions to recieve the full state pension,i have 45 full years,so you explain to me why i have been awarded a reduced pension,you have more chance of throwing a snow ball at the sun than getting threw to the pensions dept.

[AVB]

hello, that would be the right thing but as i can see only 10/20% of our younger generation are able to do so as many are on £7/8 per hour not being able to afford to buy and paying high rents or even still living with family till ?? years. then it wont be much of a retirement for them at 67

I don't believe that youngsters are as hard up as people think. They all have the latest phone, go on holidays, flash cars etc. Yes there will be some on minimum wage but not the majority.

 

What people don't realise is the effect that compound growth has on your pension. For example if you pay £X per month into a pension between the age of 20-30 then this will generate the same retirement pot as contributing £X per month between 30-60. Get in early although I appreciate that these are sometimes the hardest times to save.