Can we retire please? How much money do you really need need?

Fragle said:
Why would I not believe it.
I can log in online and check and have called to confirm.

What have I missed ?
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As long as it has been confirmed by the future pensions forecast Team it will be correct.

Anyone else like HMRC's nat ins team it isn't necessarily.

I had many forecasts Off the system all showing 34 years full contributions + x number of years before retirement . When contacted the futures pensions team only 27 years counted.The rest,although"full"years were contracted out so they do not count.
 
Al n Val said:
After reading this thread i’m feel a bit better, not a lot just a bit so why do I feel like I do?

We are 67 & 69 and have really only just started enjoying ourselves as in motorhoming, this being our 3rd year.

I’ve just added up our assets, we get just over £25k a year in pensions, have £350K+ in the banks. We have circa £850K in property 2 of which bring in £450 a month rent.

No mortgages, don’t smoke but like a drink. A BMW and a £90K motorhome

I still run my own business although tailoring it down to fit in more with our travelling which earns me after tax around £65K per

i’m frightened to death of running out of money and regret massively not retiring fully and years ago so we had more time to enjoy it

Why do I feel like I do?

Please no smart wisecrack answers, i've grafted to get where I am but can’t seem to be able to stop 😟
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It was probably your fears that have driven you throughout your life to get where you are now. Worries about bills, mortgages, providing for children, and the rest. It is hard bordering on impossible to change the habits of a lifetime. Don't beat yourself up about it. By the sounds of it, you have made it. Time to stop worrying and enjoy your time together. We are all a long time in a box. Congratulations and good luck. 👍
 
BnBJwf said:
It was probably your fears that have driven you throughout your life to get where you are now. Worries about bills, mortgages, providing for children, and the rest. It is hard bordering on impossible to change the habits of a lifetime. Don't beat yourself up about it. By the sounds of it, you have made it. Time to stop worrying and enjoy your time together. We are all a long time in a box. Congratulations and good luck. 👍
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I think it's really difficult to drop work for some people for me it's been part of my identity for so many years and also I know once I drop it and come off the register it would be really hard to start again. On the other hand looking at the sums were not too badly off and I know we will have enough if I stop. Maybe the answer is we all are different and some of those people others pity as they have a short or non existent retirement before dropping off their perch might have been happier working than retired.
 
Minxy Girl - the future pensions department said I needed to be sure to state that my extra payment related to years after 2016. I decided to pay each year up to my state pension age in order to get full pension. Worked out about £5000, but if I live to receive 3 years extra pension (I think that was the figure) , then I recoup the money. They do keep moving the goal posts tho - I’m a WASPI too! I’ll believe it when I get it - 2 years 3 months & counting! Luckily the state pension is a top up to my works pension, as well have to wait quite a while for hubby to start receiving anything - downside to marrying a toy boy! 🤸🤸
 
If you are topping up a works pension with the state pension, then don’t forget the income tax if it takes you over the £12500 personal allowance. On any extra income you will have to pay 20% tax so the pay back time is a little longer (3.75 years) still worth doing though!

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I remember about 10 years ago having a pensions lecture by a salesman telling us all we should put everything ( including commercial property) into a SIPP.

I commented to a senior colleague at the time that the tax advantages of it going into the SIPP were all well and good but there was a price to pay when you took it out.

I bumped into that same long retired colleague last year who reminded me of that conversation and told me about a horrendous tax bill he had received because he needed to access the money quickly.

The best advice is to take advice.
 
Rats - I think I'm going to have put on my big girl pants and call this future pensions unit, because I'm befuddled.
I stopped paying NI when I retired in 2015
Pension forecast is £148/wk because I'm "missing" five years contributions [even though I've got 41 full years]

Maximum will be the £175/week but I presume I'll have to pay each & every missing year... so that'll be 8 years by the time I get to state retirement age.

According to my 'record'... a rough £750/year = about £6k to get the £27/wk top up or £1404 per annum...
Which means I've got to live at least 4yrs 4 months to start 'winning'.

That's not accounting for any lost interest/dividends on the £6k...

...but what I gather you're saying, is that I might not need the full 8 years to get the maximum - hence call this Future Pensions Unit.

Complex innit
 
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The Wino said:
Don't get the last bit!. It seems fairly reasonable to me to have a pension linked to how many years full ni has been paid if anything I think the extra years people can buy are way too cheap when compared to annuities especially given index linking etc. Its a pity the system isn't easier to get into though to look at how the contributions stack up.
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Why? They are only paying what they would have if they hadn't been contracted out and thus their NI contribution reduced to take account of this. All they should have to pay is the amount that was needed to take them to the minimum needed each year for it to count towards a 'full' pension year, that will vary from person to person depending on how many years they need to 'top up'. Why should they pay more when no-one else would have had to if they hadn't been contracted out? The pension is only a part of the NI contribution, not the whole amount.
 
Stonemags76 said:
Minxy Girl - the future pensions department said I needed to be sure to state that my extra payment related to years after 2016. I decided to pay each year up to my state pension age in order to get full pension. Worked out about £5000, but if I live to receive 3 years extra pension (I think that was the figure) , then I recoup the money. They do keep moving the goal posts tho - I’m a WASPI too! I’ll believe it when I get it - 2 years 3 months & counting! Luckily the state pension is a top up to my works pension, as well have to wait quite a while for hubby to start receiving anything - downside to marrying a toy boy! 🤸🤸
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Well I thought we'd got it sorted ... when we married he was 5 years and 1 month older than me so we always joked that we'd get our pensions together! As it stands now when he gets his it will be 6 years and 1 month afterwards that I'll get mine! :swear2:

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Oscar said:
Contact the Future Pension Centre - GOV.UK (www.gov.uk)

Check your State Pension forecast - GOV.UK (www.gov.uk)

When you look at the Future Pension Centre webpage - it suggests that you check your forecast online
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It does, but with a caveat:

You can also check your State Pension forecast online to find out how much you could get and how you can increase it.​
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It it stupid that a system like this can't tell you exactly where you stand and what you need to do to ensure you are entitled to the maximum SP, I wonder how many people are 'misled' when it says you have X full years and don't do anything because of it without realising 'full years' is in effect meaningless as they could be 'not quite full years'.
 
I have been fully retired for a year, I did retire before that but went back for 3 days a week when they asked me. I thought I might miss working as I did enjoy my job, this year I was asked to work for a boiler they were having problems with and the man who now had my job couldn't fix it. I still have my licence until 2021so they registered me with Gas Safe and I went back for that job and I also did a couple of breakdown calls as well. I worked again for the odd half day and they got me to install a multi zone control system. In total I worked 57 hours, and although I still like the work I also remembered why I stopped. The traffic, parking etc. I doubt I will ever work again and even in lockdown, when most of my time is spent on the sofa, I don't miss it.

Pensions, when Kathy gets her state pension in 20 months our combined state pensions will be about £19,000, as Kathy will be under her tax allowance she can transfer 10% to me (marriage allowance) that gives me an allowance of £13,750 I will take cash from my drawdown pension to top up, 25% is tax free and after my allowance is used up I will pay 20% tax on anything else. At the moment I am only taking up to my allowance, but if I take £10,000 a year I will have to pay £750 (approx) tax. That will give us about the same or more than when we were working and had a mortgage and were still paying into the pension.
I just need this pandemic to be ov so we can really enjoy retirement.
 
Minxy Girl said:
Why? They are only paying what they would have if they hadn't been contracted out and thus their NI contribution reduced to take account of this. All they should have to pay is the amount that was needed to take them to the minimum needed each year for it to count towards a 'full' pension year, that will vary from person to person depending on how many years they need to 'top up'. Why should they pay more when no-one else would have had to if they hadn't been contracted out? The pension is only a part of the NI contribution, not the whole amount.
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I've not checked the amounts and I'm not an accountant but I suspect that the extra ni payment due is based on the minimum ni that would have been paid if paid in employment wheras a lot in employment pay a lot more. If they saved a lot more than that by contracting out is it fair to pay less back in to get the same benefit?
I really meant it sounded a bit cheap compared to an annuity that would give anything like the same payment.
As you say though if everyone else is able to get the same it seems reasonable to charge the same as some others would have paid.
Minxy Girl said:
It does, but with a caveat:

You can also check your State Pension forecast online to find out how much you could get and how you can increase it.​
​
It it stupid that a system like this can't tell you exactly where you stand and what you need to do to ensure you are entitled to the maximum SP, I wonder how many people are 'misled' when it says you have X full years and don't do anything because of it without realising 'full years' is in effect meaningless as they could be 'not quite full years'.
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I think the problem is that website stuff is often written by people who work in that area and without realising use terms that are perfectly clear to them but not to Joe public.
 
The Wino said:
I think the problem is that website stuff is often written by people who work in that area and without realising use terms that are perfectly clear to them but not to Joe public.
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Or as I call them uncivil servants
 
One thing to bear in mind ... if you do NOT need to go to work think about leaving those jobs and let others who do need to work have them ... there are going to be a lot of people out of work or with a much reduced income so a job that someone is just doing because they can even though they don't need the money could instead go to someone who desperately needs it.

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The Wino said:
I've not checked the amounts and I'm not an accountant but I suspect that the extra ni payment due is based on the minimum ni that would have been paid if paid in employment wheras a lot in employment pay a lot more. If they saved a lot more than that by contracting out is it fair to pay less back in to get the same benefit?
I really meant it sounded a bit cheap compared to an annuity that would give anything like the same payment.
As you say though if everyone else is able to get the same it seems reasonable to charge the same as some others would have paid.
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The trouble with annuities is that there is no guarantees with them, some people benefit, others won't and that's not the idea of having a minimum guaranteed pension income.

The only reason contracted out people were paying less for the State Pension in the first place is that they were paying for it elsewhere and thus their NI contribution was reduced by this small amount for this purpose and the rest of the NI would still have been taken for all other things, just as it would for everyone else and at a rate proportional to their income.

It was still costing something, just to a different 'scheme' which was intended to make up the 'shortfall' for the State Pension due to them not paying this portion fully, thus if they want to be on the same level as others who weren't contracted out they are just paying in the portion purely for the SP which they didn't initially and which now may cost more now than it would have had they paid it at the original time.

Its a shame that at the time when you're working you're not given the option to continue to pay the full NI and have a contracted out pension too as the small amount each month wouldn't likely have made much difference to a lot of people but having to stump up many thousands of pounds to make up the shortfall afterwards can be very difficult for those who have already left work and now have a limited income.
 
The State Pension system is ridiculously complicated. Especially the deductions for "contracted out" years. My understanding is that you gave up your SERPS / S2P accrual during that period, and instead you were supposed to have a Guaranteed Minimum Pension element in your works pension or personal pension to offset this deduction. Most people with a works pension effectively had no choice and were opted-out regardless.

I get the impression (correct me if I am wrong) that if you are under the new single tier SP system from 2016 onwards you can effectively make up for past contracted-out years as long as you are adding complete NI contribution years to your record. That wasn't possible for those like me who got their pension under the pre-2016 SP.

There should never have been contracting-out. A flawed policy. Did the majority of people on average earnings actually gain from it, or did they lose, thanks to the pensions industry failing to match the optimistic presumption that private pensions would outperform the earnings-related part of the State Pension? As well as the Equitable Life scandal that the government of the day (G Brown PM who seems to have detested pensions) decided to limit compensation to 22% of loss. Grrrr.
 
Minxy Girl said:
The trouble with annuities is that there is no guarantees with them, some people benefit, others won't and that's not the idea of having a minimum guaranteed pension income.
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Not sure what you mean by that. Once a private pension pot has been converted into an annuity that becomes in effect a guaranteed income. I suppose the risk is that the annuity provider might go bust, but I can't think of an example except (spit) Equitable Life. Annuities may still be more suitable for some retirees than a drawdown. It depends on their goals and circumstances.
 
I looked at annuities years ago and stopped paying in as the return is poor and inflation can reduce the value. Since drawdown came in I have put as much as I could afford into my pension, I wish I had been able to do so before. With drawdown I can choose when to take my pension and thereby reduce my tax liability.
 
Minxy Girl said:
The trouble with annuities is that there is no guarantees with them, some people benefit, others won't and that's not the idea of having a minimum guaranteed pension income.

The only reason contracted out people were paying less for the State Pension in the first place is that they were paying for it elsewhere and thus their NI contribution was reduced by this small amount for this purpose and the rest of the NI would still have been taken for all other things, just as it would for everyone else and at a rate proportional to their income.

It was still costing something, just to a different 'scheme' which was intended to make up the 'shortfall' for the State Pension due to them not paying this portion fully, thus if they want to be on the same level as others who weren't contracted out they are just paying in the portion purely for the SP which they didn't initially and which now may cost more now than it would have had they paid it at the original time.

Its a shame that at the time when you're working you're not given the option to continue to pay the full NI and have a contracted out pension too as the small amount each month wouldn't likely have made much difference to a lot of people but having to stump up many thousands of pounds to make up the shortfall afterwards can be very difficult for those who have already left work and now have a limited income.
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I did well in put of the contracted out scheme, I contacted out when I was advised to by my financial advisor, and contracted back in when press reports advised it 10 years later. So I have 10 years contributions into my drawdown pension, but still had over 35 years NI for a full state pensions. 😉

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Stonemags76 said:
Minxy Girl - the future pensions department said I needed to be sure to state that my extra payment related to years after 2016. I decided to pay each year up to my state pension age in order to get full pension. Worked out about £5000, but if I live to receive 3 years extra pension (I think that was the figure) , then I recoup the money. They do keep moving the goal posts tho - I’m a WASPI too! I’ll believe it when I get it - 2 years 3 months & counting! Luckily the state pension is a top up to my works pension, as well have to wait quite a while for hubby to start receiving anything - downside to marrying a toy boy! 🤸🤸
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Bet there’s some positives tho;)
 
gus-lopez said:
depends if you were 'contracted out' ifso all those years come off of any state pension payable under the post 2016 state pension

Because they state you have the benefit of the contracted out payments in to a firms pension.The new state pension wasn't to give youa full state pension + your firms one

only if you have the time to make up contracted out payments. I was 6 or 7 years contracted out , Retiring in 2019 under the post 2016 pension scheme means I was only allowed to pay for the 2016-2017- 2017-2018 & 2018 -2019 years Any before 2016 did not count.

It is 40% more than I manage to live on.:giggle:

No it doesn't matter what it says the only 100% guaranteed pension confirmation is when you contact the "Future pensions forecast team"

Mine said I had far in excess of the required years on the 'state pension forecast' I did , unfortunately any contracted out years do nit count post 2016.Even the HMRC national insurance help desk will only tell you what full years you have paid in for They have no idea whatsoever whether ALL THE YEARS COUNT. They now are required to tell you when/if you ring " Have you spoken to the Future pensions forecast team" as an opening statement due to many people paying in for years before 2016 that do not count towards pension rights.
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Sorry, can I just ask, if you ask the gov.uk for a pension forecast do you get a "realistic" figure of what you will actually receive?
 
I have just come off the phone after waiting for about an hour but it answered my question so hey ho.

I have 46 full years on my record and retired from FT employment in 2016. I was in a contracted out scheme (Teachers Pension) so can only make £168 tops. Luckily I will reach state pension age in March 2022 so they don't count the tax year 2021/22. Even with 46 years of full contributions I would have to pay circa £1400 to get an additional £10 per week pension. I have never won much gambling (not a big gambler mind), so do I pay up or rue not going into profit towards the end of year three when i will be nearly 69?

I need to get a Euromillions ticket for tonight just in case :smiley: .

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Hirsch said:
Even with 46 years of full contributions I would have to pay circa £1400 to get an additional £10 per week pension. I have never won much gambling (not a big gambler mind), so do I pay up or rue not going into profit towards the end of year three when i will be nearly 69?

I need to get a Euromillions ticket for tonight just in case :smiley: .
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If I had the cash to spare I'd pay up.
 
Hirsch said:
I have just come off the phone after waiting for about an hour but it answered my question so hey ho.

I have 46 full years on my record and retired from FT employment in 2016. I was in a contracted out scheme (Teachers Pension) so can only make £168 tops. Luckily I will reach state pension age in March 2022 so they don't count the tax year 2021/22. Even with 46 years of full contributions I would have to pay circa £1400 to get an additional £10 per week pension. I have never won much gambling (not a big gambler mind), so do I pay up or rue not going into profit towards the end of year three when i will be nearly 69?

I need to get a Euromillions ticket for tonight just in case :smiley: .
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Think how much income £1400 will provide in today's financial market. If buying missing NI contribution years will return £10 pw additional State Pension, that's an absolute bargain. Grab it while it lasts. Check to be absolutely certain first though.
 
Hirsch said:
I have just come off the phone after waiting for about an hour but it answered my question so hey ho.

I have 46 full years on my record and retired from FT employment in 2016. I was in a contracted out scheme (Teachers Pension) so can only make £168 tops. Luckily I will reach state pension age in March 2022 so they don't count the tax year 2021/22. Even with 46 years of full contributions I would have to pay circa £1400 to get an additional £10 per week pension. I have never won much gambling (not a big gambler mind), so do I pay up or rue not going into profit towards the end of year three when i will be nearly 69?

I need to get a Euromillions ticket for tonight just in case :smiley: .
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Sounds to me like it's worth doing! When you ring the Future Pension centre, they should advise you which years would be your best option to purchase, and give you a reference number to quote when you make the payment, which should ensure you are credited with the correct year(s). In the past, when you access your online pension forecast and you look at your NI contributions, it usually gives you a figure & a date to pay it by. The figure you would have to pay could increase if paid after that date.
 
Hirsch said:
I have just come off the phone after waiting for about an hour but it answered my question so hey ho.

I have 46 full years on my record and retired from FT employment in 2016. I was in a contracted out scheme (Teachers Pension) so can only make £168 tops. Luckily I will reach state pension age in March 2022 so they don't count the tax year 2021/22. Even with 46 years of full contributions I would have to pay circa £1400 to get an additional £10 per week pension. I have never won much gambling (not a big gambler mind), so do I pay up or rue not going into profit towards the end of year three when i will be nearly 69?

I need to get a Euromillions ticket for tonight just in case :smiley: .
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I was in the same situation as you - happily paid the dosh to get the extra, currently triple locked, inflation proof pension

There's about a 3 year payback, but if I do die before the three years are up it won't matter to me, as I'll be dead🙂

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