National insurance contributions

Fisherman

Full Member
Posts
4,520
Likes
11,871
It was the same with a lot of big firms, at our retirement seminars they said we needed 35 years of NI they did not mention that some of our years were contracted out.
For example I did 40 years with the same firm but still needed another 6 extra years.

I was told I could not buy any years because I had worked throughout my adult life. I worked and paid NHI for 50 years yet received a reduced pension. But I am not complaining, I have my fire service pension and my OAP. I reckon I have been lucky, far luckier than others, who have worked hard all of their days and have much less to show for it.
 

trevskoda

Full Member
Posts
26,560
Likes
32,172
I think we all have been conned over the years, sys is too complicated for folk to which I think is deliberate. :(
 
  • Like
Reactions: GMJ

wildebus

Full Member
Posts
4,457
Likes
5,577
Anyone who was contracted out due to a company pension, will not get the full £700.80 4 weekly pension. They are affected by COPE (contracted out pension equivalent) I now receive £610 due to being contracted out in the fire service .
I am not complaining I did pay a reduced contribution, just trying to offer this.
info. Also there is no option available to buy a larger pension using class 3 contributions. This is only available if you missed years for various reasons.

I find this aspect quite confusing I have to admit. I have currently (once they correct one of the years) 37 Full Years of contributions and will get the full State Pension entitlement once 2 more years are credited (below is based on 3 more years)
Estimate based on your National Insurance record up to 5 April 2020
£166.11 a week
Forecast if you contribute another 3 years before 5 April 20xx
£179.60 a week

(Fortunately for me, the amount I have been asked to pay to get the full 39 years I will actually get back in increased Pension in less than 36 weeks, so in that respect it is a 'no-brainer')

However ... I paid into different Private (company) pension schemes for over 20 years and my pension info knows I was contracted out and that "Your COPE estimate is £60.84 a week." (which is pretty low if that was true!)

I don't know if differences in peoples forecasts are due to the change between the old state pension + SERPs (which is what people contracted out of) compared to the New State Pension? or the way different private pension schemes were managed? (mine were Money Purchase schemes, but I know a lot of people were on Final Salary type pension schemes which seemed to give very nice results)
 
Last edited:

trevskoda

Full Member
Posts
26,560
Likes
32,172
I took a privat pension which was to be a vast some of money, turns out they were telling porkies, to get back what i paid in I would have to live to 144, I stopped the payments and now look after my own monies.
 

harrow

Full Member
Posts
7,146
Likes
8,834
I was told I could not buy any years because I had worked throughout my adult life. I worked and paid NHI for 50 years yet received a reduced pension. But I am not complaining, I have my fire service pension and my OAP. I reckon I have been lucky, far luckier than others, who have worked hard all of their days and have much less to show for it.
Yes I could not buy added years, but I did make AVCs additional voluntary contributions, once I paid the mortgage off :unsure:
 

Sharon the Cat

Full Member
Posts
5,121
Likes
4,986
As an example of someone who was contracted for some of the time but has a full NI record.

Your National Insurance record​

You have:
  • 44 years of full contributions
  • 7 years to contribute before 5 April 2027
You do not have any gaps in your record.

Your forecast is
£179.60 a week
£780.94 a month, £9,371.27 a year
Your forecast

  • is not a guarantee and is based on the current law
  • is based on your National Insurance record up to 5 April 2020
  • does not include any increase due to inflation

£179.60 is the most you can get​

You cannot improve your forecast any more.

If you’re working you may still need to pay National Insurance contributions until 7 September 2027 as they fund other state benefits and the NHS.

View your National Insurance record
Your forecast may be different if there are any changes to your National Insurance information. There is more about this in the terms and conditions.

You’ve been in a contracted-out pension scheme​

Like most people, you were contracted out of part of the State Pension.

You were contracted out​

In the past you’ve been ‘contracted out’ of the additional State Pension.

When you were contracted out:

  • you and your employers paid lower rate National Insurance contributions, or
  • some of your National Insurance contributions were paid into another pension scheme, such as a personal or stakeholder pension
The amount of additional State Pension you would have been paid if you had not been contracted out is known as the Contracted Out Pension Equivalent (COPE).

Contracted Out Pension Equivalent (COPE)​

Your COPE estimate is£52.70 a week.

This will not affect your State Pension forecast. The COPE amount is paid as part of your other pension schemes, not by the government.

In most cases the private pension scheme you were contracted out to:

  • will include an amount equal to the COPE amount
  • may not individually identify the COPE amount
The total amount of pension paid by your workplace or personal pension schemes will depend on the scheme and on any investment choices.

 

Fisherman

Full Member
Posts
4,520
Likes
11,871
I find this aspect quite confusing I have to admit. I have currently (once they correct one of the years) 37 Full Years of contributions and will get the full State Pension entitlement once 2 more years are credited (below is based on 3 more years)
Estimate based on your National Insurance record up to 5 April 2020
£166.11 a week
Forecast if you contribute another 3 years before 5 April 20xx
£179.60 a week

(Fortunately for me, the amount I have been asked to pay to get the full 39 years I will actually get back in increased Pension in less than 36 weeks, so in that respect it is a 'no-brainer')

However ... I paid into different Private (company) pension schemes for over 20 years and my pension info knows I was contracted out and that "Your COPE estimate is £60.84 a week." (which is pretty low if that was true!)

I don't know if differences in peoples forecasts are due to the change between the old state pension + SERPs (which is what people contracted out of) compared to the New State Pension? or the way different private pension schemes were managed? (mine were Money Purchase schemes, but I know a lot of people were on Final Salary type pension schemes which seemed to give very nice results)
David the whole thing is confusing even to my accountant.
This new scheme was supposed to SIMPLIFY things, well I must be dumb.
But as I have said I have no complaints whatsoever.
 

maingate

Full Member
Posts
10,644
Likes
12,358
I took a privat pension which was to be a vast some of money, turns out they were telling porkies, to get back what i paid in I would have to live to 144, I stopped the payments and now look after my own monies.
I always thought these schemes were a con Trev. They made more money for the provider than they did for the customer. My Brother in Law is a prime example of this. He is barely getting back what he paid in.

I looked after my own money and could change the type of investments to what was good at the time. The old PEPs and Tessas were quite good in their day and you could get access to some or all of it quickly if needed. Property is also a good money maker at times but Shares (as in Unit Trusts, Fund of Funds etc.) are good steady earners. Bank Savings Accounts are a dead loss.
 

colinm

Full Member
Posts
2,886
Likes
2,675
David the whole thing is confusing even to my accountant.
This new scheme was supposed to SIMPLIFY things, well I must be dumb.
But as I have said I have no complaints whatsoever.
IF! .gov stick to the present scheme for years to come it will eventually become simpler, but meantime they committed to nobody losing out with the new scheme, that means for those of us who where in at least four different schemes they have to calculate it out. In my case the latest forecast was some one hundred and ninety something pounds.
 

wildebus

Full Member
Posts
4,457
Likes
5,577
It can take a long time for these things to work themselves out. the last main employer I had used to take over staff due to TUPE requirements when they got new outsourcing contracts - this mean they had literally hundreds and hundreds of different employment contracts to deal with - as there is a requirement that staff don't lose out when their employer changes out of their control.
And this also means masses of different Pension arrangements that different staff had - as you can be sure that anyone on a final salary scheme will not be mad enough to give it up! Must have been a nightmare to deal with!

In the financial crash of 2008-2011, my department was cut back by 75% and depending how you joined the company (a transfer or a volunteer) would change what your payout was. I just got the redundancy pay plus an extra payout and a small bonus for training my replacement in India (so much for redundancy as in 'job is redundant'!). Others doing the same job and also giving the push got those same benefits PLUS their pension early as apparently redundancy at 50+ when on public sector pension schemes means early retirement with full benefits. Nice for those folk, eh.
 

REC

Full Member
Posts
2,999
Likes
5,651
Just paid two years top up, apparently it will not be worth paying the last year before due to get pension as it will only give £1 extra pension. The pension helpline was very friendly and seemed to give good advice. The two years topup will be recouped within three years ..not taking pension increases and inflation into account.
I was contracted out so have an element of COPE included in my NHS pension apparently. There was a shortfall in an earlier year 2013 but the helpline said that as the pension rules changed 2015/16 (I think!) and I had maximum pension by then, there was no point topping up that year...the topup is for the years that were added on to my retirement age ....took early retirement planning to get state pension at 64yrs....then they changed the goalposts and have had to make more contributions too! As Fisherman said, the "simplification" made it very complicated, particularly for those in the last few years before retirement!
However my husband paid for a self employed pension for thirty years and gets less than £100 month....think he will have to live till 150 to recoup costs!
 
Last edited:

jann

Full Member
Posts
802
Likes
462
I agree with several other posters.The help line for pension contributions is very helpful and have the right knowledge.
 
  • Like
Reactions: REC

GMJ

Full Member
Posts
386
Likes
1,074
This is a very useful thread as I too assumed it was 35 years for the full pension and was unaware of the changes.

Some info here...

 

GMJ

Full Member
Posts
386
Likes
1,074
Can anyone help?

I may have missed this in all the 'Govt-speak' on line but where can I find my starting amount and the number of qualifying years I need? I have got a Pension Forecast off my Govt Gateway account but it doesn't make it clear regarding the new rules. Also there is no mention of 39 years rather than 35 years.

I manually added up my years including and prior to 2016 as 30 year full years. I have another 4 years of full contributions since 2016. So is it a manual calculation that I need another 5 years to get to the 39 or is there somewhere official on-line I can check this...or do I need to ring the pensions helpline?

ta
 

Sharon the Cat

Full Member
Posts
5,121
Likes
4,986
Can anyone help?

I may have missed this in all the 'Govt-speak' on line but where can I find my starting amount and the number of qualifying years I need? I have got a Pension Forecast off my Govt Gateway account but it doesn't make it clear regarding the new rules. Also there is no mention of 39 years rather than 35 years.

I manually added up my years including and prior to 2016 as 30 year full years. I have another 4 years of full contributions since 2016. So is it a manual calculation that I need another 5 years to get to the 39 or is there somewhere official on-line I can check this...or do I need to ring the pensions helpline?

ta
Using https://www.gov.uk/check-state-pension I got the following, which is quite clear.

£179.60 is the most you can get​

You cannot improve your forecast any more.​
If you can or need to make an additional payment, presumably it will say so.
 
  • Like
Reactions: GMJ

Drover

Full Member
Posts
308
Likes
383
I took a privat pension which was to be a vast some of money, turns out they were telling porkies, to get back what i paid in I would have to live to 144, I stopped the payments and now look after my own monies.
I bet it was the same firm I had :mad:
 

GMJ

Full Member
Posts
386
Likes
1,074
I cant find anything on this raise from 35 years to 39 years. even Martin Lewis says its still 35 years...This from the MSE website:-

The NI years needed for a full basic state pension are:

  • 35 years: If you reached state pension age on or after 6 April 2016
  • 30 years: If you reached state pension age on or after 6 April 2010
  • 44 years (men), 39 years (women): If you reached state pension age pre-6 April 2010

Can anyone throw any light on this?
 

GMJ

Full Member
Posts
386
Likes
1,074
Using https://www.gov.uk/check-state-pension I got the following, which is quite clear.

£179.60 is the most you can get​

You cannot improve your forecast any more.​
If you can or need to make an additional payment, presumably it will say so.

I get Carers Allowance for looking after my wife who has MS. Because of this I get my stamp paid.

Mrs GMJ who can't work gets PiP (and formerly got DLA) but doesn't get her NI contributions paid!! Doesn't seem really fair to me.
 

wildebus

Full Member
Posts
4,457
Likes
5,577
I cant find anything on this raise from 35 years to 39 years. even Martin Lewis says its still 35 years...This from the MSE website:-

The NI years needed for a full basic state pension are:

  • 35 years: If you reached state pension age on or after 6 April 2016
  • 30 years: If you reached state pension age on or after 6 April 2010
  • 44 years (men), 39 years (women): If you reached state pension age pre-6 April 2010

Can anyone throw any light on this?
He would appear to be wrong?

The rational and reasoning behind it is a different question, but basically it is as Sharon the Cat posted and if you follow the link she posted you will see your own personal situation.

UPDATE:
I went to the MSE website to look at this and TBH, I didn't look for very long as (IMO) the info is poorly explained, as well as being incorrect and incomplete in quite a few areas.
 
Last edited:

GMJ

Full Member
Posts
386
Likes
1,074
He would appear to be wrong?

The rational and reasoning behind it is a different question, but basically it is as Sharon the Cat posted and if you follow the link she posted you will see your own personal situation.

UPDATE:
I went to the MSE website to look at this and TBH, I didn't look for very long as (IMO) the info is poorly explained, as well as being incorrect and incomplete in quite a few areas.

I have done that and as I say I can't see anywhere where this rise from 35 to 39 years is mentioned. Can you/anyone specifically point me to that please? NB The Governments own website specifically says 35 years:

"You’ll need 35 qualifying years to get the full new State Pension."





Fyi mine (off the link provided which is my Govt Gateway account) says...

You can get your State Pension on 20 January 2034. Your forecast is
£179.60 a week
£780.94 a month, £9,371.27 a year
Your forecast


  • is not a guarantee and is based on the current law
  • is based on your National Insurance record up to 5 April 2021
  • does not include any increase due to inflation

£179.60 is the most you can get

You cannot improve your forecast any more.

If you’re working you may still need to pay National Insurance contributions until 20 January 2034 as they fund other state benefits and the NHS.


Your forecast may be different if there are any changes to your National Insurance information. There is more about this in the terms and conditions.


You’ve been in a contracted-out pension scheme

Like most people, you were contracted out of part of the State Pension.

 
Last edited:

Users who viewed this discussion (Total:0)

Top