UK State pension calculation

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fyfin
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UK State pension calculation

Postby fyfin » Sun Jul 22, 2018 12:56 pm

I just did an online check for my wife's pension (really easy to do now) and we had assumed that as she has 34 years of the 35 required to get a full pension (now £164.35) that the calculation would simply be 34/35 of £164.35 but surprise surprise it was a lot less, around £129.
I then read some of the notes and it appears to be saying that only qualifying years after 6th April 2016 count in this way. Also, despite the fact that she has 34 qualifying years it was showing that she could continue to pay voluntary contributions to increase her pension in 2021 so essentially more than 35 years. (She was one of the unlucky ones regarding the 60 age retirement for females being born in 1955.)
It makes it really difficult to work out how they calculate the £129 but I'm guessing it's maybe 34/35 of an older figure. Just seems a bit unfair.
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Re: UK State pension calculation

Postby Unicorn » Sun Jul 22, 2018 1:03 pm

I suggest you call the pensions people and they will make an appointment to call back and discuss. I have come across this situation recently and 35 years were not required (only 30) for a pension of around 175 pounds a week. They are working out some pensions in the new way for that cohort and some in the old way and will grant the best one.
Previous information and these forecasts can be very misleading. Talk to someone, note what they say, day and time.

Call them post haste, my advice.

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Re: UK State pension calculation

Postby fyfin » Sun Jul 22, 2018 1:11 pm

I agree but this is the official government website after logging in. They show you every individual year where you made contributions so the forecast is accurate. They state they will pay the higher of the old system or new system and luckily they did in my case, the new system would have given me £38 p.w. after 45 years contributions (all to do with opting out). The old system paid £140 pw which I now receive.
I'm just not sure how they have calculated my wife's , maybe a phone call tomorrow.
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Re: UK State pension calculation

Postby chrissiehope » Sun Jul 22, 2018 1:14 pm

I also was born in 1955 ! I checked my pension a few years ago, and found that I too was short. There was a list of incomplete/empty years, and dates you had to pay by. Luckily a couple of years were short only a relatively small amount, so I topped them up, and then chose the next least expensive & topped up that so I now have the full requirement, and should get the full amount (less a small amount for an old contracted out pension).
Having said all that, I should probably check again, in case they've moved the goalposts (again :-( )
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Re: UK State pension calculation

Postby fyfin » Sun Jul 22, 2018 2:03 pm

I would definitely check again. Gives you an instant figure on screen
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Re: UK State pension calculation

Postby olive » Sun Jul 22, 2018 2:26 pm

Unicorn wrote:I suggest you call the pensions people and they will make an appointment to call back and discuss. I have come across this situation recently and 35 years were not required (only 30) for a pension of around 175 pounds a week. They are working out some pensions in the new way for that cohort and some in the old way and will grant the best one.
Previous information and these forecasts can be very misleading. Talk to someone, note what they say, day and time.

Call them post haste, my advice.
Link is https://www.tax.service.gov.uk/check-your-state-pension


Bit worrying that they make mistakes. .......... :think: :think:

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Re: UK State pension calculation

Postby Unicorn » Sun Jul 22, 2018 2:29 pm

All I can say is that the information from the place in Newcastle (?)in person was different from the calculator and all info that had been received in the post. Especially only needing 30 years and not 35 to get a full pension.
The guy admitted that mistakes had been made mainly because the goalposts had been moved around so swiftly.

Anyway, personally I think one phone call is worth doing, but it is personal choice.

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Re: UK State pension calculation

Postby Unicorn » Sun Jul 22, 2018 2:34 pm

For accuracy's sake the full pension having paid 30 years, qualifying in Late 2020 was, in current day worth 177 pounds per week.

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Re: UK State pension calculation

Postby fyfin » Sun Jul 22, 2018 3:26 pm

Olive, that's the same link I used, logging into the government gateway, so I would be very surprised if the figure is wrong. I was just curious as to how it is calculated and how you can add extra years over and above 35 to increase your pension. Seems a bit illogical but that's what the link told me. Even gave the cost for each year, about £700 and how much extra pension that would bring.
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Re: UK State pension calculation

Postby fyfin » Mon Jul 23, 2018 10:12 am

Well I called today and had a chat with a guy and it seems a little odd to me still but he basically said even if you have the full 35 years, if you were opted out at any time then you can continue to contribute to increase your pension.
In my wife's case, as she worked for Royal Mail, the scheme itself was contracted out so she falls into that category. I don't think we'll be doing it though as it's not really worth the hassle in her opinion. About £733 for each year and 4 years to get an additional £18 per week however would be a good investment and a good rate of return.
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Re: UK State pension calculation

Postby Unicorn » Mon Jul 23, 2018 10:22 am

That is why I advised you call, and they are very helpful. The calculators do not give the full picture sometimes. Do make a note of the time, date and name of the person in case of comeback. At least that is what we were advised by them to do.

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Re: UK State pension calculation

Postby fyfin » Mon Jul 23, 2018 12:40 pm

Well, the point is that he said all the information on the website gov.uk was correct so nothing will change unless my wife makes extra contributions. I'm sure beforehand if you made 39 or 44 (men) years contributions, then any further years did not add to your basic state pension. That's why I was surprised when he said she could keep on adding years and increasing the final pension i.e. more than the 35 which gets you a full pension under the old scheme.
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Re: UK State pension calculation

Postby casita-bonita » Mon Jul 23, 2018 1:31 pm

Just done my own calculation and the changes in payment age have cost me and my wife the best part of £60,000 in lost payments now that we both have to wait until we are 66. Thoroughly pi55ed off.
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Re: UK State pension calculation

Postby fyfin » Mon Jul 23, 2018 2:10 pm

Along with my wife who is definitely not happy as she was one of the ones who lost out born in 1955.
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Re: UK State pension calculation

Postby casita-bonita » Mon Jul 23, 2018 3:36 pm

Me also, 1955 was a good year, however I have lost out on 'only' 1 year. My wife, born in 1957 on the other hand loses out on 6 years and she would have been in receipt of a pension for the last 18 months... Keep an eye on the WASPIs, you never know something may happen in our favour.
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Re: UK State pension calculation

Postby peteroldracer » Tue Jul 24, 2018 9:35 am

If you can afford to, consider delaying taking the pension. AFAIK this results in an increased pension when you do take it.
Of course, all these factors do not take into account how long you will be a pensioner before you die!
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Re: UK State pension calculation

Postby marios » Tue Jul 24, 2018 5:13 pm

Those that have lost out dramatically should follow the backto60 campaign, my wife was born in 56 so in the same boat, we have donated to this cause and will continue to, Michael Mansfield QC is heading the legal challenge.

https://www.backto60.com/legal
https://www.youtube.com/channel/UClqrl0 ... fUcdoUNGbg

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Re: UK State pension calculation

Postby Lavanda » Tue Jul 24, 2018 7:31 pm

I paid in for 35 years and never 'opted out' whatever that is, was born in 1953, had to wait an extra four years and seven months for my pension and it's an average of €620 a month. It's pants, basically. Thank goodness the State Pension is not my only pension!!!

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Re: UK State pension calculation

Postby Wicksey » Wed Jul 25, 2018 10:13 am

They may mean 'contracted out'. As a former civil servant my national insurance contributions were 'contracted out' and this will affect my state pension. It is very complicated and from what I have read the contracted out NIC deductions no longer exist. I used to pay slightly less NIC than the non-contracted contributions. There were 2 different schemes in place as to how the pension is calculated and there have been people over or underpaid due to the complicated nature of calculating who should get what. https://www.telegraph.co.uk/politics/20 ... dentifies/

More info here
https://www.gov.uk/government/publicati ... ne-service

I too have to wait an extra 6 years for my state pension although we never worked the full term so only have about 20 years of contributions each. I took my small civil service pension early at 55 and we manage pretty well on a modest unearned income that we would never survive on in the UK. Whatever we may get when we're both 66 will be a bonus!

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Re: UK State pension calculation

Postby fyfin » Wed Jul 25, 2018 11:40 am

Wicksey, indeed. Some people don't realise their scheme was contracted out e.g. my wife's with Royal Mail. It gets complicated which is why I asked the DWP for an explanation but they didn't really answer probably because they don't understand it themselves. You're right about the cost of living here - much better and we can survive quite well on what we have. Happy days.
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