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Full state pension?

Discussion in 'Retirement' started by Compassman, Aug 4, 2019.

  1. Compassman

    Compassman Star commenter

    My sister has just turned 65 was telling me today that she will be getting her state pension next year.

    She was a teacher from 1975-2012 so did 37 years.

    She was telling me that she will not get her full state pension as teachers don’t get that? Is this correct as she has done her full 35 years of NI contributions.

    I have done 30 years in teaching and another 4 years elsewhere so another year to go to make my 35 years. I am only 56. Does that mean that when I reach state pension age (67) I won’t get my full pension.

    I’ve looked on the internet but don’t seem to get a full answer.
  2. HelenREMfan

    HelenREMfan Star commenter

    I think she is referring to new state pension.... after the increase. As teachers we were in our own scheme so aren't eligible for it as I understand it. It didn't seem right to me but there wasn't any hue and cry so I presumed I'd had it.
    border_walker likes this.
  3. littlejackhorner

    littlejackhorner Occasional commenter

    I think it is because we were classed as "opted out" and consequently paid lower national insurance contributions. This changed within the last few years so some people will have managed to add the necessary contributions. If you have left work you can I believe buy back previous years. I plan to do this myself but last time I logged on to the government pension website my details still needed updating so I have not been able to buy back years. The government website will give you details about your predicted state pension
    border_walker likes this.
  4. Lara mfl 05

    Lara mfl 05 Star commenter

    It's to do with any govt / LA jobs. They 'negotiated a reduced rate of NI contributions and so anybody in the 'old scheme' will have a reduced entitlement as they have a SERPS pension and that is supposed to make up any difference.
    I remember being told a minimum amount that TPS was expected to pay me.
    Last edited: Aug 4, 2019
  5. Informant

    Informant New commenter

    My understanding is that under the 'old' rules for state pensions, if you had made NI contributions for a minimum of 30 years then you receive the full basic state pension, but not necessarily an enhancement known as SERPS or S2P (second state pension). Beware the basic state pension is "basic" [about £6k if I remember rightly]. In 2015 the rules were reformed to increase the basic state pension [to about £8k I think] and eliminate the variation individuals had with S2P, but you need more years of NI contributions to receive this [35 minimum I think].

    You can obtain the definitive answer by registering online with HMRC for an account which will provide your pension forecast. This will tell you how you might maximise your pension payments if you can buy additional years of NI contributions. Say they cost £750 and payout a bit more than £4 extra per week, then it would be worth thinking about. I suspect you'll be able to buy years you may have missed after 2015, but check if there's a cut off date by which you must make that payment.

    No advice given here other than "register with HMRC to find out".
    border_walker and Lara mfl 05 like this.
  6. catmother

    catmother Star commenter

    sign up to the government gateway to find out where your state pension is at.
  7. Sundaytrekker

    Sundaytrekker Star commenter

    TPS was a contracted out pension scheme. If you have your full years in teaching prior to 2015 you will get your full old value state pension. Since 2015 teachers have paid the same rates as others as there isn’t a contracted out rate now. If you are still working for a certain amount of years you can qualify for the full new pension which is over £8000 a year. As has already been stated, you can pay voluntary contributions if you are not gaining credited years through working.

    As catmother and others say, best to sign up through gov.uk to find out your own exact position.
    Lara mfl 05 likes this.
  8. diddydave

    diddydave Established commenter

    Use this link to check your state pension estimate: https://www.gov.uk/check-state-pension

    One other thing to consider is how many years you might need to make up...I need 6.

    You can get these by paying 'voluntary contributions' and one of the cheapest methods, if you are not already working and paying, is to become an 'invigilator' or 'examiner' - both of these allow you to pay the class 2 contributions which are currently £3 a week or £156 a year.

    My state pension without the 6 years is £144.05 a week.
    With the extra 6 years it would be £168.60 a week.

    £24.55 extra a week = £1276.60 a year....doesn't take a lot to see that's a pretty good return (if I should reach the age of 67!)
    Lara mfl 05 likes this.
  9. eljefeb90

    eljefeb90 Senior commenter

    Lots of information here! I presume your sister has not worked since 2012. As others have said, the rules changed in 2015, so, in exchange for increased pension contributions, teachers become eligible for the full state pension. If your sister earned more than (roughly) £6000 per annum from 2015 onwards, she will have boosted her entitlement to the new higher pension by paying national insurance. A full year's contribution from 2015 onwards is equivalent to about £4 extra pension per week for the rest of your life. If your sister earned less than £6000 or did not work , I would advise her to phone up HMRC and make Class 3 contributions for every year from 2015. Last time I looked these were about £800 a year. As @diddydave says, it is more cost effective to work as an invigilator or examiner and pay the reduced rate N.I. self employed contributions. If she has worked as an examiner/invigilator, she should register as such with HMRC from 2015 or earlier and pay any missing N.I.contributions.
    £800 sounds like a lot, but you get over £250 per annum in increased pension for every year you live. You break even in just over three years and are quids in by the age of 70. With interest rates so low, it really is a no-brainer. She can pay HMRC in instalments or in lump sums.
  10. catbefriender

    catbefriender Lead commenter

    After a protracted call to HMRC I was told you can ONLY buy back years for Class 1 NI contributions from 2016! So previous to that, it's only NI Class 3 you can buy, which works out at a whopping £746 a year which will enable you to get something like an extra £4 a week.

    Most people in their 50s and 60s opted out so there are a lot of people who will be getting lower pensions. The fun part is, you find out when you actually apply o_O as what is said online is only for 'guidance purposes only.'

    After what they did to the women in their late 50s/early 60s, i.e. changing the pension start dates to 65 and then 66, and NOT informing them well in advance, they can do anything and they probably will.:(
  11. catmother

    catmother Star commenter

    I might be wrong on that one but for most people,the new state pension (even if not full as contracted out) will be more money than the old state pension.So new state pension+work pension is still a decent deal,IMO.
  12. catbefriender

    catbefriender Lead commenter

    I hope you are right, but I am used to getting 'surprises' from the HMRC such as the pension age for women moving to 65, 66, 67 and for other 68! After my protracted phone call, I was told that where it says on your pension forecast, 'we are still working out your contributions for that year,' NOTHING is going on and will go on. If the year is not full, that's it. You could have paid 51 weeks of NI contributions that year, but because you did not pay 52 you have lost that year and £4 a week for life.

    There is some ambiguous stuff also about the prediction being an estimate and stating what you should get and it not being a guarantee and because you were opted out, but somehow it will be made up.

    It's as clear as mud.
    lardylegs likes this.
  13. catmother

    catmother Star commenter

    If that was the case,could you not buy back contributions?
  14. catmother

    catmother Star commenter

    It really was not a surprise,those changes were not kept a secret.

    It is true that a certain age range of women,who were not going to be affected by the original plan to equalize state pension age,got caught up in the sudden next change. However,any women who is due to get her state pension at 68 is currently in their late 40s. IMO,there is no way someone that age would still think that they are getting their state pension at 60.
  15. catbefriender

    catbefriender Lead commenter

    ]Yes, but at £749 for every incomplete year, it's so UNFAIR! You'd think they would pro rata the amount of years you have paid i.e 0.5 and 0.75 = 1.25 years, but they don't. If you've paid, 0.99 one year or 0.01 it's still nil.:(
    tbau likes this.
  16. catbefriender

    catbefriender Lead commenter

    No, but a lot of women in their late 50s and early 60s didn't know and they are the ones living on the poverty line until they get their state pensions at 65/66.
    Lara mfl 05 likes this.
  17. phatsals

    phatsals Senior commenter

    I'm sorry catbefriender but I think you have some confusion in your posts.

    You can/could buy back years from pre-2016, but this is only worth it if you have less than 30 years contributions under the old system. Under those rules you had to have full years to count towards your state pension. They always wrote to individuals informing them of shortfalls and giving the opportunity to pay for the 'missing service', ie you did not pay twice. You had 6 years to make up this shortfall. Each week/month was counted rather than an overall sum

    Under the 'new' system again you can make up 'shortfalls' for any given year, individuals are sent letters in the October after the end of the tax year. From this you can choose whether or not to make up shortfalls, you would only pay for a full year if you had no contributions for that year.

    In terms of women being unaware of the changes to the equalisation of pension age I don't agree. It had been widely publicised since 1995. I agree that there are a small number of women who have been caught out by the shift to 66 and onwards, but this is a small minority. These women do indeed deserve to have their cases reviewed.
    border_walker likes this.
  18. catbefriender

    catbefriender Lead commenter

    I have NEVER received a letter from the HMRC stating that I could make up for the shortfall UNLESS I wrote and requested it. As I mentioned above, I had a protracted phone call in July this year, almost 1.5 hours :eek:regarding this. Yes, I can buy back those years at £749, but as I still have the years to pay them via PAYE, or pay them at £156 self employed, I will take that cheaper option and get £4 a week for life when I retire, I hope, i.e. if the goalposts haven't moved again by then.

    I am aware of a number of women who were ill informed. The best way the government could have informed ALL of them was via their P45s etc. I remember telling a man at the bus top around the time and he was flabbergasted and he said, 'Serve you bleedin women right! You wanted equal rights, now you've got it!' And went into a jolly rant. I think the misunderstanding was WHO will be affected and the problem was, they knew it was changing but the ambiguity was about which group of women were to be caught out i.e. from which date of birth. There are many cases of if you were born on say April 1st you could be out, whereas if you were born on 31st March you were in.

    I knew I would be getting my state pension at 65 (now 67 :(), at that time, but many women in their late 50s and early 60s, found out too late. And another BIG problem, not many people want to employ the over 50s.:(

    BTW I found out 2 years after it was announced that the state pension was going up to 67, from 66. So it's so easy to miss this stuff if you are busy getting on with your life.
    Last edited: Aug 5, 2019
  19. phatsals

    phatsals Senior commenter

    Again, I disagree. If your pension age is 67 then you are younger than me, state pension equalisation has been well publicised since 1995.

    As I said, there is a small group of women affected by the change from 65 to 66. The law requires 10 years notice and this has not been given to this particular group. For the rest of us it has. Regrettably I am in the first group of women for whom the change is from 66 upwards, if I were 3 months older I would get my pension 4 months earlier.

    I personally had a stack of letters going back several decades informing me of shortfalls. I received one letter every year I had an incomplete record. I doubt very much HMRC were sending letters only to me. The most recent one being last October.

    Again, as I said, if you have part missing years you can make up the shortfall. The full year is only when no contributions have been made. The £749 is for the years since '15, the previous years were less than that as they gave entitlement to a lower state pension. Again, partially incomplete years required partial payment, not the whole year being paid for twice.

    Married women who have either been out of the workforce, or who paid reduced NI are now facing difficulties. They were previously entitled to some SP from their husbands NI, but this is no longer the case. They now need a minimum of 10 years under their own account. This group also ought to have their situations reviewed.
  20. PeterQuint

    PeterQuint Lead commenter

    Can anyone answer this?

    I worked for 9 years in a ‘normal’ job, but contracted out of SERPS for the last 4.

    Then 25 years as a teacher.

    Will I qualify for a full state pension?

    If not, how many more years do I have to work to get there?


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