Nat Ins Contributions - Missing Years

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

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.

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.

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.

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.

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.

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.

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 !

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

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.

That looks like the full state pension, Katyj.

Hi Shandy there are 6 years in total not full, two before 2016 and four after, two of those were during the pandemic when I spent some time on furlough so
not sure if they’ll count .
It says I cannot improve my forecast any more and I should receive £9371 PA although this is not guaranteed.

Did you do any grandchild care? I’ve added two missing years for free as I filled in the “ specified childcare” form. My step daughter was working 2 days a week and we looked after the baby one day a week. She wasn’t using her NI from child benefit so someone else can claim to instead. This is not published so I make it my mission to spread the word.
Husband had enough contributions so I had them instead. No minimum hours required and no proof required other than daughters NI record checked.
I’m only 2 years short now. Naively, I didn’t know my teachers pension meant I was opted out for part of my earning life.
I can claim for one more year of childcare which will be after my pension starts in September .
Claims can be backdated for a number of years.

There's a forum on MSE about Pensions and several people have posted about buying additional years.

www.moneysavingexpert.com/savings/state-pensions/

Oh I see. Thank you Shandy I’ll have to go back on and have another look.

Are they pre2016 Katyj? Any years before the changes won't register as an increase.

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.

Yes you are right Shandy57 just checked my paperwork , I paid an additional 5 years. Each year paid was worth £5.13 per week so I have an additional £25.65. I paid £3978 so 3 years and 1 week I am quids in. I think thats correct.

I thought each year only gave an additional £5 per week 1summer?

Same for me, I had 4 years missing contributions due to being contracted out. After taking advice I paid the missing years in a lump sum, the pension people were very helpful but 3 months after I paid it still not showing on statement. A quick call sorted it. It gives me an extra £25 a week.
Yesterday I received my first state pension payment, just got to live over 3 years to get be quids in.?
As NannaRose says you are on the whole better getting extra pension for increased years, as pension increases year on year and the longer you live the better off you will be.
But I wouldn’t have used all my savings as need some for rainy day.

Just a general warning. Nobody should buy in any years before checking with the DWP and HMRC and getting a statement as to what difference it will make. I very nearly paid for one missing year that wouldn’t have affected the amount I got at all, and I was told I wouldn’t have had it refunded once I’d paid.

Also, if you’ve done any childcare at all for your grandchildren or other young relatives, even a few hours over a short period, you could be entitled to free NI credits.

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

Doodledog’s advice is spot on Winterday. I would contact Citizens Advice or Age UK for a benefit check. Their information will be comprehensive and right up to date ( it is also free ! ) Your Specialist may not be aware of the many nuances involved in claiming benefits. It is a difficult position to be in to be just above the Pension Credit level as you would miss out on so many other benefits i.e. council tax benefit, housing benefit and help with prescription glasses amongst others. At the end of the day, if it was in your best interests to pay the missing contributions, they would advise you to and you would then have the peace of mind to know you had made the right decision. Good luck with it all !

I was a servant for 36 years and was contracted out I and my friends discovered our state pensions would be lower than we expected,
I thought about it and decided to put £3000 into my contributions on the basis that if I lived for 3 years after the start of my pension being paid it would be beneficial so fingers crossed.
I thought it was a good decision and spoke to a very nice lady at the DWP.,so perhaps a phone call to them would guide you through it.

Slightly off topic, sorry, but a friend of mine has retired and is deferring her state pension. She owes a few years for being contracted out. Does anyone know if she can still pay the missing years, or has she left it too late now she is pension age?

I retired at 60 and continued to pay for some previous missing years. I was advised by someone at the tax office that it was worth it in order to get the maximum state pension and that I would recoup this in 2 years. Although it was a bit of a struggle I have no regrets and enjoy the higher level of pension now.