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Thread: National Insurance Contributions / State Pension

  1. #1

    National Insurance Contributions / State Pension

    I've checked my wife's NI records just to see if she's going to get a full state pension. Her records say

    35 years of full contributions - this includes a number of years when she didn't work at all (bringing up the kids)

    10 years to contribute before 5 April 2032

    6 years when you did not contribute enough

    For the more recent years where she's not paid enough there is an option to pay a top up, but I understand that 35 years of contributions was what you needed, so I don't see any point in making any top ups.

    Am I missing something?
    Andy

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  2. #2
    Quote Originally Posted by andy tims View Post
    I've checked my wife's NI records just to see if she's going to get a full state pension. Her records say

    35 years of full contributions - this includes a number of years when she didn't work at all (bringing up the kids)

    10 years to contribute before 5 April 2032

    6 years when you did not contribute enough

    For the more recent years where she's not paid enough there is an option to pay a top up, but I understand that 35 years of contributions was what you needed, so I don't see any point in making any top ups.

    Am I missing something?
    I think you are right that should be sufficient but it should also show what she is expected to get vs what she could get? This should help you decide. E.g. mine says "you will get £x.xx per week/month/year" (can't remember the exact number) and also says "£x.xx (the same number) is the most you can get, you cannot improve your pension any further".

  3. #3
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    Quote Originally Posted by tertius View Post
    I think you are right that should be sufficient but it should also show what she is expected to get vs what she could get? This should help you decide. E.g. mine says "you will get £x.xx per week/month/year" (can't remember the exact number) and also says "£x.xx (the same number) is the most you can get, you cannot improve your pension any further".
    Also interested in this subject as when checking my wifeís forecast it said something similar so we just left it.

  4. #4
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    I only mentioned this on another thread recently as Iím am due to be retiring soon some 10yrs before my official retirement date and wondered if I should keep my NI contributions up to maximise my state pension.

  5. #5
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    Quote Originally Posted by tertius View Post
    I think you are right that should be sufficient but it should also show what she is expected to get vs what she could get? This should help you decide. E.g. mine says "you will get £x.xx per week/month/year" (can't remember the exact number) and also says "£x.xx (the same number) is the most you can get, you cannot improve your pension any further".

    It used to but no longer says that on the beta website. Another example of government improving something to make it worse.

    Make sure you use this one: https://www.tax.service.gov.uk/check...state-pension/
    Last edited by Scepticalist; 19th January 2023 at 17:30.

  6. #6
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    Itís not as simply as you say.
    I have 42 years contributions with three being underpaid. It says I still need another two years to get a full pension and given Iím retired that isnít going to happen (although the payback period for voluntary top up is fairly short so I may top up nearer the time.
    If she was contracted out that can make a difference and at one time women could pay a ďreduced stampĒ (although that may have been before your wife started working.

    Some info here

    https://www.citizensadvice.org.uk/de...state-pension/

  7. #7
    No need to top up more, she has hit the max 35
    Numbers all make sense to me
    Of the 41 years since she turned 16, she had 35 years where she contributed enough, 6 where she didn't
    She has 10 years to go until state pension age to gain more years if needed, she doesn't need any more

  8. #8
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    One thing to bear in mind is whether she 'opted out' for a work pension. I worked in the NHS and HE sectors and despite having over 40 years of contributions I wasn't due the full state pension. I topped up a few years but not enough for the full amount.

  9. #9
    Quote Originally Posted by tertius View Post
    I think you are right that should be sufficient but it should also show what she is expected to get vs what she could get? This should help you decide. E.g. mine says "you will get £x.xx per week/month/year" (can't remember the exact number) and also says "£x.xx (the same number) is the most you can get, you cannot improve your pension any further".
    Yes thanks

    https://www.gov.uk/check-state-pension

    allows you to check your pension forecast. It doesn't project forward it just works on the current rate.

    For my wife it says that based on her NI record to April 2022 she'd get £183.62 per week, but if she contributes for another year between now & April 2032 it would be £185.15 per week & that is the most she can get. So despite having 35 years she does need another year of contribution to get the max state pension, but there is no point in making top up payments.

    Strangely the picture is different for me.

    I have 38 years of full contributions (and for a good proportion of those I've been a higher or top rate tax payer), but based on my NI record to April 2022 I'd only get £162.76 per week. I have to contribute for another 5 years before April 2032 before I get up to the maximum state pension?

    I think I need to find out why my 38 years of full contributions don't already qualify me for the maximum & why I need to get to 43 years of full contributions before that happens.

    Wonder how long I'll be on the phone for?
    Last edited by andy tims; 19th January 2023 at 18:42.
    Andy

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  10. #10
    Hi all

    I hit the 35 years a few years back, then was contacted that my age of retirement is 67 and 200 days (or close to that). I have the option to pay the class two for the next 12 years, or stay where I am.

    My thoughts is that the 12 extra years of payment I would get a better return else where rather than my pension, plus it more liquid if I have control over it.

    However, "your milage may vary".

    Thanks
    deano

  11. #11
    Grand Master Andyg's Avatar
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    I just went through this. I was informed that although I had 42 years of contributions, because of opting out of SERPS or whatever and because I havenít paid any in the last 6 year (retired) was told I wouldnít get the full wack. I was missing 2 years. It was only £7/week shy of the max state pension, however the very friendly lady at HMRC suggested I pay for Tax year 2020/21 and this would increase my pension up to £183/week - at a cost of just under £800.

    No brainer as it will pay for itself after 3 years - assuming I live until I was 69. To reach the max amount, it would have cost me over £800 for about an extra £1.70/week.

    Also remember that pensions are indexed linked, so will increase faster than money in the bank.

    Whoever does not know how to hit the nail on the head should be asked not to hit it at all.
    Friedrich Nietzsche


  12. #12
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    When considering whether to pay any shortfall, or not, remember a Ďtriple lockí could be your friend.

  13. #13
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    This is very interesting- Iíve just looked at mine and Iím £10 a week short of max
    Iíll be 55 this year and have been retired for nearly 2 years - living off my savings
    Wondering if I should see if I can pay something in to reach the max

  14. #14
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    Quote Originally Posted by andy tims View Post
    Yes thanks

    [URL]https://www.gov.uk/check-stalte-pension[/URL]

    allows you to check your pension forecast. It doesn't project forward it just works on the current rate.

    For my wife it says that based on her NI record to April 2022 she'd get £183.62 per week, but if she contributes for another year between now & April 2032 it would be £185.15 per week & that is the most she can get. So despite having 35 years she does need another year of contribution to get the max state pension, but there is no point in making top up payments.

    Strangely the picture is different for me.

    I have 38 years of full contributions (and for a good proportion of those I've been a higher or top rate tax payer), but based on my NI record to April 2022 I'd only get £162.76 per week. I have to contribute for another 5 years before April 2032 before I get up to the maximum state pension?

    I think I need to find out why my 38 years of full contributions don't already qualify me for the maximum & why I need to get to 43 years of full contributions before that happens.

    Wonder how long I'll be on the phone for?


    Typical of my experience on a .gov.uk web page. Iím stumped after the first page following ĎStart Nowí

  15. #15
    Craftsman Tickeros's Avatar
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    Martin Lewis has covered this recently.
    I only have 28 years. Pension due in 12 months.
    However, if I top up three incomplete years, @£1400, before 6.4.2023, I'll get another £15 per week. I'll recover that in less than 2 years, so no brainer.
    Obviously YMMV, but for every completed year you get an extra £5 per week. Just depends on what it costs to top up those years.
    You need to create a Govt. Gateway account to view your details.
    To top up, you need to call them and get bank details, and a reference number pertanant to you.

    https://www.moneysavingexpert.com/sa...tate-pensions/

  16. #16
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    Iíve got coming up to 40 years nowÖ.. 37 years as a dentist & 3 years cleaning the school after hours when I was a pupil there...the latter I was surprised to see there was a record of.

  17. #17
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    Quote Originally Posted by lewie View Post
    This is very interesting- Iíve just looked at mine and Iím £10 a week short of max
    Iíll be 55 this year and have been retired for nearly 2 years - living off my savings
    Wondering if I should see if I can pay something in to reach the max
    It will be worthwhile but not now, wait until nearer retirement as without being morbid, you donít know if you will make retirement age.

  18. #18
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    Quote Originally Posted by Tickeros View Post
    Martin Lewis has covered this recently.
    I only have 28 years. Pension due in 12 months.
    However, if I top up three incomplete years, @£1400, before 6.4.2023, I'll get another £15 per week. I'll recover that in less than 2 years, so no brainer.
    Obviously YMMV, but for every completed year you get an extra £5 per week. Just depends on what it costs to top up those years.
    You need to create a Govt. Gateway account to view your details.
    To top up, you need to call them and get bank details, and a reference number pertanant to you.

    https://www.moneysavingexpert.com/sa...tate-pensions/
    Mine isn't £5 a week, the website says I'm a year short of max contributions but the difference in pension is 98p.

  19. #19
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    41 years of full contributions here and still £9pw short of the max which it suggests will be met if I have 2 more years. I think that's due to many years when I was contracted out but it's something I'll look at when I go part-time/retire.

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    Last edited by deepreddave; 20th January 2023 at 08:49.

  20. #20
    Quote Originally Posted by deepreddave View Post
    41 years of full contributions here and still £9pw short of the max which it suggests will be met if I have 2 more years. I think that's due to many years when I was closed as contracted out but it's something I'll look at when I go part-time/retire.

    Sent from my HD1903 using Tapatalk
    Same here mate Iím 3y short due to be opted out by a company I worked for 20 odd years ago

  21. #21
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    Quote Originally Posted by Tickeros View Post
    To top up, you need to call them and get bank details, and a reference number pertanant to you.

    https://www.moneysavingexpert.com/sa...tate-pensions/
    After paying the top up you then keep an eye on it whilst expecting the top up to be applied at the start of the next tax year. You then wait another 4 or so months and decide to write to them explaining that the top up has not been applied. You follow the progress of your letter on their website for another 4 months or so, and then notice that the progression of your letter has disappeared. So you finally lodge a complaint, which also takes them months to sort out......... ask me how I know

    Keep an eye out for any years with underpayments, as it may only be a matter of a few pounds to make those years fully paid up. My wife worked part time and we were able to make 3 of those years fully paid up for around £220 in total

  22. #22
    Master Thewatchbloke's Avatar
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    My forecast is £189.66 a week so I presume I've paid more than the minimum required? 44 years of full contributions, 6 years to go, 1 year where I didn't contribute enough.

  23. #23
    Quote Originally Posted by andy tims View Post

    I think I need to find out why my 38 years of full contributions don't already qualify me for the maximum & why I need to get to 43 years of full contributions before that happens.

    Wonder how long I'll be on the phone for?
    So after quite wait to get through, a very helpful lady from HMRC explained that the reason I was not getting the full despite 38 years of "full contribution" was because I was in employer pension schemes that were contracted out of SERPS for most of those years.
    Andy

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  24. #24
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    Quote Originally Posted by andy tims View Post
    So after quite wait to get through, a very helpful lady from HMRC explained that the reason I was not getting the full despite 38 years of "full contribution" was because I was in employer pension schemes that were contracted out of SERPS for most of those years.
    Yep, generally the most common reason- I mentioned it in post #6

  25. #25
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    Of a thought, does anyone know how much/possible it is to buy whole years and is it worth it? Or can oyu only make up exisiting years where the contributions are short?

    My wife's been in the UK for about 15 years now and the likelihood is only 5 more maximum given our plans.

  26. #26
    Master RLE's Avatar
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    Quote Originally Posted by Scepticalist View Post
    Of a thought, does anyone know how much/possible it is to buy whole years and is it worth it? Or can oyu only make up exisiting years where the contributions are short?

    My wife's been in the UK for about 15 years now and the likelihood is only 5 more maximum given our plans.
    If you register on the HMRC Gateway, you can confirm which years have no or part contribution. Expand the relevant year and it will give you the value of the voluntary contribution required to be paid up for that tax year.

    Rules are due to change at the end of this tax year. As it stands now there is no time limit to top up contributions. As an example I can top up for 2009/ 2010. Maximum period to backdate will be 6 years from April 2023.

    Cost varies but majority of my missing contributions amount to £824 per year. One or two at £792.

  27. #27
    Master M1011's Avatar
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    Sort of doubt state pension will be a thing when my generation are finally allowed to retire at age 90.

  28. #28
    Master Thewatchbloke's Avatar
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    Quote Originally Posted by M1011 View Post
    Sort of doubt state pension will be a thing when my generation are finally allowed to retire at age 90.
    Fair point, well made!

  29. #29

    National Insurance Contributions / State Pension

    Currently 36 years of full NI credit, but only 97.6% of full pension.

    I do wish they would show which years you where contracted out of SERPS, and hence which years do not count as the information provided is misleading.

    Does 1 year NI count for £5.29 of pension (1/35 x 185.15 = £5.29)?

    If so, I only have one more year to count (in effect this year) as I have £180.24 pension built up as of 5 Apr 22.
    Last edited by noTAGlove; 20th January 2023 at 14:48.

  30. #30
    Master chrisb's Avatar
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    Quote Originally Posted by Scepticalist View Post
    Of a thought, does anyone know how much/possible it is to buy whole years and is it worth it? Or can oyu only make up exisiting years where the contributions are short?

    My wife's been in the UK for about 15 years now and the likelihood is only 5 more maximum given our plans.
    If you have the opportunity to top up, do it. If you think that you will live past retirement age, longer than the extra years you are buying.
    I bought 2 years, and I've already recouped the outlay.
    IIRC, you can only go back 3 years, so get in early and do it every year or so.
    Last edited by chrisb; 20th January 2023 at 14:51.

  31. #31
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    32 years full contributions, 100% of full pension but another 19 years to keep paying!


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  32. #32
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    Some posters have said that you can top up for any missing years no matter how far back - this is not true for everyone. I could only top up as far back 2016 & have it make an effect on my State Pension - HMRC will gladly take your money for earlier years but it would not have counted to increase my SP. This is outside of any changes coming this year.

    The situation is very complex & it is vital to call the Pensions Department & get them to give you individual advice: you should make very clear notes of any discussions as there have been many mistakes in information given out.

  33. #33
    Master M1011's Avatar
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    Quote Originally Posted by Mr Pointy View Post
    Some posters have said that you can top up for any missing years no matter how far back - this is not true for everyone. I could only top up as far back 2016 & have it make an effect on my State Pension - HMRC will gladly take your money for earlier years but it would not have counted to increase my SP. This is outside of any changes coming this year.

    The situation is very complex & it is vital to call the Pensions Department & get them to give you individual advice: you should make very clear notes of any discussions as there have been many mistakes in information given out.
    Better yet, record the conversation for reference.

  34. #34
    Quote Originally Posted by Mr Pointy View Post
    Some posters have said that you can top up for any missing years no matter how far back - this is not true for everyone. I could only top up as far back 2016 & have it make an effect on my State Pension - HMRC will gladly take your money for earlier years but it would not have counted to increase my SP. This is outside of any changes coming this year.

    The situation is very complex & it is vital to call the Pensions Department & get them to give you individual advice: you should make very clear notes of any discussions as there have been many mistakes in information given out.
    Pretty clear on the Gov website you can only top up the past 6 years (and not 3 as someone above mentioned).

  35. #35
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    Quote Originally Posted by Kingstepper View Post
    Pretty clear on the Gov website you can only top up the past 6 years (and not 3 as someone above mentioned).
    That is incorrect; in some situations you can top up years further back, at least until the rules change in April.

    You CANNOT rely on the information on Pension Forecast on the .gov website & should always check your individual situation with the Pensions Department. While there may be a wait to get through to them I have always found them very helpful.

  36. #36
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    Quote Originally Posted by Scepticalist View Post
    Of a thought, does anyone know how much/possible it is to buy whole years and is it worth it? Or can oyu only make up exisiting years where the contributions are short?

    My wife's been in the UK for about 15 years now and the likelihood is only 5 more maximum given our plans.
    First get a Pension Forecast & see what your baseline is:
    https://www.gov.uk/check-state-pension

    Then contact the Future Pension Center & they should be able to tell you how many, if any, past years you can purchase & how much each year would cost - some years may be part purchased already. Note the rules change this year limiting how far back you can go so you might want to check sooner rather than leaving it:
    https://www.gov.uk/future-pension-centre

    Generally you buy years at the current rate which goes up every year so you'll pay more next year than you would this: the current rate for a year of Class 3 contributions is £824.20

  37. #37
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    Quote Originally Posted by Thewatchbloke View Post
    My forecast is £189.66 a week so I presume I've paid more than the minimum required? 44 years of full contributions, 6 years to go, 1 year where I didn't contribute enough.
    How can it be more than £185.15? I thought that was the maximum?

  38. #38
    Grand Master learningtofly's Avatar
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    Quote Originally Posted by Thewatchbloke View Post
    My forecast is £189.66 a week so I presume I've paid more than the minimum required? 44 years of full contributions, 6 years to go, 1 year where I didn't contribute enough.
    Almost identical. £195.17, 45 years of full contributions, 1 year without a full contribution, 3 years to go.
    Last edited by learningtofly; 21st January 2023 at 11:36.
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  39. #39
    Quote Originally Posted by trident-7 View Post
    How can it be more than £185.15? I thought that was the maximum?
    Just what I wanted to ask, mine says it will be £185.15 which is the maximum?


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  40. #40
    Grand Master learningtofly's Avatar
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    Quote Originally Posted by Craizeehair View Post
    Just what I wanted to ask, mine says it will be £185.15 which is the maximum?


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  41. #41
    Grand Master Passenger's Avatar
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    Quote Originally Posted by M1011 View Post
    Sort of doubt state pension will be a thing when my generation are finally allowed to retire at age 90.
    That's the working assumption I took...think I' m on for 68 currently though they appear to have left themselves some wiggle room so it might go up, again. lol.

  42. #42
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    Quote Originally Posted by Craizeehair View Post
    Just what I wanted to ask, mine says it will be £185.15 which is the maximum?


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    Yup Iím getting this limit too.

  43. #43
    Quote Originally Posted by learningtofly View Post
    We're special.
    I wish I was specialÖ


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  44. #44
    Grand Master learningtofly's Avatar
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    Quote Originally Posted by Craizeehair View Post
    I wish I was specialÖ


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    You are to me
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  45. #45
    Master unclealec's Avatar
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    Quote Originally Posted by learningtofly View Post
    We're special.
    I'm special too. Max for me is £147ish, 'cos I was born before 6th April 1951. Pensioner second class.

    Moral - don't be born before 6th April 1951!

  46. #46
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    Born 1965, started work 1982. 41 full years with no lapses giving me £192.67.

  47. #47
    You have:

    47 years of full contributions
    1 year to contribute before 5 April 2023
    2 years when you did not contribute enough

    You need to continue to contribute National Insurance to reach your forecast
    Estimate based on your National Insurance record up to 5 April 2022 £184.12 a week
    Forecast if you contribute another year before 5 April 2023 £185.15 a week

    £185.15 is the most you can get

    Based on my details I should have started working/contributing when I was 16

  48. #48
    Master
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    Quote Originally Posted by Craizeehair View Post
    Just what I wanted to ask, mine says it will be £185.15 which is the maximum?


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    This is set up by the Government though so you can get more than the maximum and probably less than the minimum!

    Your starting amount is more than full new State Pension

    The part of your starting amount which is above the full new State Pension is called your Ďprotected paymentí. This is paid on top of the full new State Pension.
    Any qualifying years you have after 5 April 2016 wonít add more to your State Pension.
    Find out more information on National Insurance contributions on the following nidirect page:


  49. #49
    Prnsion forecasr



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  50. #50
    Master Halitosis's Avatar
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    My forecast says Iíve made 32 years of full contributions and yet will get the max £185.15. Is that the case even if I stopped contributing today, or is it assuming I will continue to contribute for another three years or more? (12 years to go until state retirement age)

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