UK State Pension - Is it really enough?

And it will only get worse, as more people reach pensionable age without having worked to contribute to the funding of pensions.

And yet unthinking people still consider almost everyone “ on benefits” is a skiver or a scrounger, whereas most of welfare spending is on pensioners, people in work on low incomes, and those who are sick or disabled. Not scroungers. Surely this is why some pensioners won’t claim Pension Credit, because they don’t want to be labelled scroungers.

That’s what upsets me Cabbie, the almost constant criticism of people needing to claim benefits.

When I read that the average Pension Credit award since the push in 2024 was £114.99 pw for a couple and £78.23 pw for a single pensioner, I think what a difference that must make and how on earth were they managing before? That single pensioner would have been trying to managing on an income of £140 a week.

I agree that the SP is insulting and should be at least equivalent to the minimum wage. In practice, many people have savings and, or, private pensions so the government kind of get away with it. But I fear for younger people who maybe aren’t paying into private pension schemes and will end up with a poor retirement.

Don't forget that there can be extenuating circumstances. I was a full-time housewife and mother. My then husband was, allegedly, paying the "married woman's stamp". Unbeknownst to me, he stopped this as (I quote) "I am paying a hefty amount into a private scheme for the both of us".

The divorce court in 1995 ensured that I received none of this (the rules have now changed). Consequently, I receive the lowest possible amount. By the time I reentered the jobs market (late forties with no skills, so on minimum wage level), I could not afford to pay for an extra pension pot. In any event, DWP advised me that the amount of payments I could make between then and retirement age, would make a negligible difference to any pension.

I agree that pension payments should be on a par with minimum wage - after all a loaf of bread costs the same for anyone. But this should have been started years ago. Private pensions taken into account and all the silly add-on benefits got rid of.

dalrymple23

Don't forget that there can be extenuating circumstances. I was a full-time housewife and mother. My then husband was, allegedly, paying the "married woman's stamp". Unbeknownst to me, he stopped this as (I quote) "I am paying a hefty amount into a private scheme for the both of us".

The divorce court in 1995 ensured that I received none of this (the rules have now changed). Consequently, I receive the lowest possible amount. By the time I reentered the jobs market (late forties with no skills, so on minimum wage level), I could not afford to pay for an extra pension pot. In any event, DWP advised me that the amount of payments I could make between then and retirement age, would make a negligible difference to any pension.

I agree that pension payments should be on a par with minimum wage - after all a loaf of bread costs the same for anyone. But this should have been started years ago. Private pensions taken into account and all the silly add-on benefits got rid of.

Why should private pensions be taken into account to give more to people who didn't pay anything into the system?

People on minimum wage are already fed up with earning less than is given to neighbours claiming benefits, and even people on higher wages have to pay out for rent, childcare, commuting costs and so on, so can have lower disposable incomes than if they chose to stay at home and not pay in. If, after decades of working, they find that private/occupational pensions are means-tested to give the neighbour who didn't work more, it would be a real slap in the face.

Your ex-husband treated you very badly, but if pensions were changed to allow for that sort of thing it would be a case of 'hard cases making bad law', I think. It is up to individuals to ensure that they pay their dues, and (particularly when there are dependent children) that their skills are up to date so they can support themselves if necessary. If only one half of a couple pays into the system, there is no real reason why two people should be able to take out, unless the second person was unable to work, as opposed to choosing not to.

I know that sounds hard, but it is precisely because we have fewer contributors than takers that 50s women (and those younger than they are) have to work an extra 6 or 7 years, and that pensions are so low. If we deal with that by means-testing occupational pensions, what incentive would there be for anyone to contribute? It would be fairer if there were a means by which you could appeal against the divorce settlement and get recognition from your husband for the contribution you made to your him and to your family.

Disclaimer - this does not mean that I think those who don't work are a 'lower form of life', as has been suggested. I think that everyone should be able to make choices that work for them. I also think people should consider the implications of their choices, and recognise that state pensions are intended to be contributory benefits. The system should also recognise that, IMO.

It should not be the case that not working brings higher rewards than working does - as I've said before, I think that frustration with that is responsible for a lot of people turning to more extreme politics.

Well said Doodledog.

Dalrymple. Were you working for your husband in his business? The married woman’s stamp would not have given you a state pension anyway. It was a reduced contribution which only gave cover for industrial injuries benefit.

Presumably, when you did return to the workplace you did pay Class I NIC so built a State Pension from then on.

For people reaching SP age before 6 April 2016 there was an opportunity to gain additional State Pension by paying Class 3A Voluntary National Insurance contributions.

assets.publishing.service.gov.uk/media/5a7ef188ed915d74e33f3674/wms-state-pension-top-up.pdf

Now you can only plug a maximum six years gap in NIC by paying voluntary Class 3 contributions but until 5 April 2025 it was possible to pay voluntary Class 3 to cover missing years back to 6 April 2006.

Obviously you need the funds to pay for the back years but it was worth doing. If you live three years past SP age then you are in profit.

At current rates, every extra year you have paid NIC for gives you an additional £6.90 a week pension.

I was made redundant into early retirement in my early 50s. I continued to pay into my state pension through voluntary contributions even though I was not working. I think it was about £5 a week in the late 1990s. Even then £5 was a relatively small anount. I also always paid the full stamp and never the married women;s stamp.

I can remember, when I was working in the 1960s/70s, every time a female colleague got married there would be the big debate as to whether to stay on the full stamp or save money by paying the Married womans stamp.

I think the question of whether a certain amount is 'enough' depends entirely on your specific circumstances. I’m 62 now, and I have no income other than the interest from my investments—yet I still feel much more fortunate than many younger people today.
​Having a paid-off home changes the entire equation. It’s a bit of a false equivalency to compare a retiree to a younger person with a higher salary; even if that younger person earns double, they are often still playing catch-up. They could save every penny they earn, and they might still never achieve the same level of home equity or the stability of an investment portfolio built over a lifetime. It’s not just about current income; it’s about the foundation built over decades, which is something many younger people are struggling to replicate today."

In five years time a State Pension will seem like a lottery win, since my investment income falls a tad short of that.

Yes, I was a bit short on my contributions. Although I had paid in 35 years, contracting out made me three years short. I paid a lump of about £2, 500 three years ago to ensure I am entitled to the full state pension in 2031.