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State Pension-Mixed Messages

Discussion in 'Retirement' started by HolyMahogany, Feb 12, 2019.

  1. HolyMahogany

    HolyMahogany Occasional commenter

    I have recently taken my teaching pension after 30 years, am now working part time and will claim state pension in 10 years at 67.
    when I got my pension record form TPA it stated that my state pension would be about £6,000per annum, obviously less than the full state pension.
    A financial advisor told me that this was due to teachers paying a different national insurance rate.
    I have logged on to the National insurance site and it gives me a different, larger number and this would seem to imply that I will be eligible for the full state pension, eventually.
    I have 34 years of NI credit so will be continuing to work to get the minimum of 35 years.
    Since my wife is also a teacher an accurate forecast of our final state pension will make a big difference to our financial planning.
    I know I can contact TPA but have found that unless you word your question very carefully and precisely they do not like to volunteer any extra information.
    Has any one had similar experiences with the state pension?

    Thanks for any advice /information.
     
  2. phatsals

    phatsals Occasional commenter

    TPS no longer gives your State Pension amount, for this you need to look at only the government websites. The figure you have from NI site is the correct one.

    Your FA possibly misunderstood your question, when you paid into TP your NI contributions were reduced and after 30 years you were entitled to the full basic state pension, no SERPS or State 2nd Pension enhancement. When the new pension came in your new State Pension amount was calculated as a baseline, comparing your entitlement under the old rules and the new, you start on the better of the two.

    Many people have been misled with the headline rate of 35 years for the new full State Pension, this only applies if you never contracted out.
     
  3. tracymicra

    tracymicra New commenter

    You could ring the National Insurance place. I think it’s in Newcastle. They were incredibly helpful when I phoned and sent out a current statement of what to expect.
     
    Lara mfl 05 and border_walker like this.
  4. Ivartheboneless

    Ivartheboneless Star commenter

    Just use the government portal for pensions which can be found via google. You need 35 years NI for full pension, but it is reduced if your contributions were reduced for "contracted out". Since about 2015 everybody pays the same NI, so if you work another ten years it will bring your state pension up, and they do not know how long you will work so the forecast may be innaccurate. As an aside, do you seriously want to work until 67? I went at sixty, will get state pension at 66. I'm not rich, but no longer a drudge at the whim of every latest initiative that has done the rounds at least three times in the last thirty years.
     
    Prim, eljefeb90 and border_walker like this.
  5. Braindead101

    Braindead101 New commenter

    I recently checked my NI record and have just over 35 years full contributions, but when looking at the pension calculator element of the site, I still need to work another 5 years in order to get a full state pension. That's about £30 per week down at the moment, certainly not enough to keep me in work until I'm in my 60s. I'll live with the shortfall.
     
    Jamvic likes this.
  6. sci

    sci New commenter

    If you find you have gaps in state pension (over last 6 years) you can top up. This can be really good value for money.I would consider doing that first before using the teachers scheme.
     
    Lara mfl 05 likes this.
  7. Braindead101

    Braindead101 New commenter

    Unfortunately my gaps were in the 80s and early 90s, so too late for me!
     
  8. phatsals

    phatsals Occasional commenter

    Gaps from that far back wouldn't make any difference to you. It was maximum 30 years contributions, any more than that were discounted.
     
  9. grumpyoldwoman2

    grumpyoldwoman2 New commenter

    I have finally reached state pension age.....I retired from teaching at 59 in 2013 after teaching for 37 years and for the last 5 years have been working part time in a supermarket. just found out I will not get full pension, only £140 less tax bringing it down to £110 a week.....yet after speaking to a former colleague who retired a year before me at the same school and she hasn’t worked since retirement and she is getting a full pension of £156 ( after tax) I’m not understanding this inequality in payment. Can anyone give me a hint as to why we are different?
     
  10. HolyMahogany

    HolyMahogany Occasional commenter

    Hi - I am not sure this will help and can only comment on my own situation. have just checked my own record on gateway.
    At present I have full 35 years of NI paid + some incomplete years - I am 57 so 10 years until I can claim state pension.
    According to pension forecast - I have two sets of numbers -
    one is the lower number £144.63 / week this is based on my current level of NI payments
    The other is for £168.60 if I continue to pay NI for another 5 years.
    Sorry - no idea how these numbers are arrived at - I assumed all I needed was 35 years - currently working part time and only pay minimum NI - about £2 per month. So will have to monitor site for next few years - I will think of some questions to ask on gateway on their helpline.
    In my experience with TPA. I think you need to prepare and word questions very carefully to get info you need when dealing with any of these organisations.
     
    grumpyoldwoman2 and Lara mfl 05 like this.
  11. HolyMahogany

    HolyMahogany Occasional commenter

    Looking at my pension forecast there is a section -
    'You’ve been in a contracted-out pension scheme
    Like most people, you were contracted out of part of the State Pension.'
    This refers to paying lower NI payments in the past - Do check your statements on your gateway record.
     
    border_walker and Lara mfl 05 like this.
  12. Lara mfl 05

    Lara mfl 05 Star commenter

    Thinking about your age I agree this is because any govt pension schemes, of which TPS is a member did pay reduced NI contributions and therefore State pension is reduced.
    However it should only be around £11 and as the SPS shouldn't push you over the tax threshold, you should get around that full £140. If your TPS then pushes you over the threshold HMRC tends to alter your tax code and therefore the taxis taken off your second pension i e TPS or any extra schemes you may belong to.

    I have only just applied for my State Pension, having deferred it till my husband became a pensioner and when I applied, by hone, thee person on the other end was incredibly helpful and could tell me all the details of what to expect , when etc. He did query why I'd deferred and when I explained that I was just over the cut off point by a couple of weeks and therefore needed 5 extra years to qualify under the new rules he explained that actually I couldn't be expected to suddenly have an extra 5 years just for the sake of a couple of weeks and there was a complicated staggering for people born between 1953, but after the April 6th cut-off, and 1955.

    I'd suggest a phone call-if you can wear the wait. They really are very helpful.

    And having deferred for 2 years I will now get more pension, index linked for the remainder of my life, than my husband who qualifies for the new top rate of SPS. After years of scrimping and saving we suddenly seem to be a bit better off. Especially as my husband will continue to work part-time and his state pension pushes him above the rate he was earning full-time. Though granted he wasn't exactly a 'top-earner' and his staff earned more than he did.
     
    grumpyoldwoman2 and HolyMahogany like this.
  13. phatsals

    phatsals Occasional commenter

    GDW, I can see how your SP has been calculates, ie always a teacher, always contracted out. This would be 30 years under the old system plus 3 years(ish) under the new.

    Your colleagues seems different. To have £156 entitlement would suggest they had not been contracted out for a number of years and not paying into a separate pension, TPS or otherwise. They must have paid or been credited with a good number of years for the additional SERPS or State 2nd pension.
     
  14. 50sman

    50sman Senior commenter

    For some years in teaching we were all contracted out.
    All you can do is deal with your own circumstances and not other people’s anecdotes

    Log onto government website and look at your own personal statement - it shows you how many years you have earned enough relevant contributory years for.

    I tells you what your entitlement is - you need to contact them if you think it is wrong - however in probably 99 % of all cases they will be right

    Just as TP is the fount of all knowledge for Teachers Pensions the Gov website is the count of all knowledge for state pensions.

    You may not like the outcome but it is what it is!
     
    HolyMahogany and Piranha like this.
  15. eljefeb90

    eljefeb90 Senior commenter

    There have been several threads on this and I, personally, have learned a lot. It may be a bit late for @grumpyoldwoman2 , but you can make Class 3 voluntary contributions if you are not employed , for every year from 2015-2016 , when the new national insurance regulations started. This will cost about £800 per year, but will enhance your state pension by £4 per week for each year you pay. If you live into your seventies, it is an excellent investment. If you don't, hard cheese!
    Alternatively, you could work part time and earn over £6000 per year, in which case, you will accrue increased pension entitlement.
     
    Lara mfl 05 likes this.
  16. Piranha

    Piranha Star commenter

    Or if you do exam marking or invigilating or run a small business such as tutoring, you can pay just £360 a year Class 2 voluntary contributions. See the current thread on the subject.
     
    Saffron5, eljefeb90 and Prim like this.

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