Nat Ins Contributions - Missing Years

Katyj

I had a look at my pension today on gateway,I’m due to receive my state pension next year, it’s says I have four missing years, but paying into these years will not increase my pension amount. Does anyone know why this could be.

@ Katyj @Shandy57 is actually incorrect, if you had significant NICs pre 2016 and paid into the additional state pensions, you can get extra on top of the new full pension, its called your protected amount.

This is how its worked out, they use 2 calculations for your state pension after 2016 how much you would have got under the old scheme, 30 years NICs, less any years you opt out, less any years you only paid the 1/2 stamp, and what you would have got if the new scheme had been in place all your working life, 35 full tax years, no opting out no additional pensions and you get the higher of the 2, this is called your starting amount. If you starting amount was over the new full rate because you got the protected amount, its then capped and none of your NICS/Credits after 2016 will increase your pension, if lower then any NICS/|Credits or any you buy will increase you pension until you reach the new full pension or reach pension age which ever comes sooner.

This is my situation, I paid NICs for 45 full tax years pre 2016,I had contracted out for 5 of those years so my state pension was reduced, however I still get a lot more than the new full pension as I got my protected amount, this meant that by 2016 my starting amount was already higher than the new pension so the NICs I paid between April 2016 and March 2021 did not increase my pension.

I get well over £200 a week with both pensions combined after tax is deducted from my private pension, if I compare that with my husband who paid NICS for 45 years under the old scheme and who gets the additional state pension on top of his basic he only gets a few £s a week more than I do, of course I would have got more than him if my pension hadn't been capped and I would have had those 4 years of extra pension.

Sorry to mislead you Katyj, that's what the Future Pensions advisor told me - best you phone yourself to check your personal situation.

No worries. I find it all confusing to be honest. I don’t have a private pension so it shouldn’t be too complicated. Just wish 66 would hurry up !

Katyj

No worries. I find it all confusing to be honest. I don’t have a private pension so it shouldn’t be too complicated. Just wish 66 would hurry up !

It's terrible we wish our lives away Katyj but I know where you are coming from. I will be 66 in 2023.

I'm 66 next year too. I was 59 when my husband died and remember my shock when I found out I'd have to wait until I was 66, it changed everything.

I am also 66 next year but I’m not expecting a huge state pension despite having enough contributing years as I was contracted out for most of those years. Luckily I was aware of this so made provision for retirement by buying extra years in my private pension and then paying monthly into a supplementary pension scheme. I was able to access my enhanced private pension at age 60 and have left my supplementary pension pot intact as part of my investments to drawdown when necessary.

Had I not known about the reduced NI contributions, I would be in a very different financial position now. As soon as my children were no longer living with me I started saving like mad, bought ISA’s each year, invested in a couple of bonds then took the advice from a IFA to amalgamate all my different savings accounts into one low risk investment account which was a good move as I’ve received excellent returns from it.

It must be a shock if you were not aware of being contracted out and were expecting the full pension or even worse, had not contributed to a private pension scheme.

Someone once told me I was lucky to have savings and a comfortable retirement but forgot the years I worked while bringing up my children and the efforts I made to save.

Things would be different if we'd been told we'd have to wait another six years. I do dislike people who say things like that Teacheranne - it's nothing to do with luck, it's graft and focus. Someone lent in my car window once and said 'if I win the lottery I'm going to get a car like yours'.

As I was unaware of the long six year wait I took my Teacher's pension at 57. At least I had the lump sum to pay the bills etc during the long, long wait for probate.

Thanks everyone for your contributions to my post, much appreciated. Just a few points:-
-I can use non isa money to pay the missing years and I wont get anywhere near the tax bracket.
-I did speak to the Nat Ins dept at length about my national insurance record.
-I did speak to a Specialist at the DWP and he explained which years were payable and how I would benefit.
-1summer - did the DWP backdate your extra income 3 months after you had paid the missing years?
Three of the years I can pay are worth £4.59 and the latest one is worth £5.13p.
Still dont know what to do and if I dont pay by this tax year, the price will go up then after 2023 there is only one year which is available and expires in 2027.
Thanks again everyone.

Just thought I'd pop on here to say thank you to I think it was Maggie who mentioned the NI childcare contributions. I've had a letter today saying I've been awarded whatever it is they are!

There must be so many benefits and entitlements that aren't known about.

Maggiemaybe another massive vote of thanks here: I knew nothing of the Specified Adult Childcare Credits until I read about it on here. It was very simple to apply for and I have been awarded six years of credits to bring me up to full state pension.
www.gov.uk/government/publications/national-insurance-credits-for-adults-who-care-for-a-child-under-12-fact-sheet/specified-adult-childcare-credits-fact-sheet