Womens State Pension

[Bazile]

There was an item on BBC Radio 4's ' money box ' programme , a couple of days ago about Women state retirement pension - most of which i missed .

It was something about paying about � 400 pounds before 5 April 2009 , to get some benefit because of missing NI contributions , otherwise the payment will double next year .

Can anyone please fill me in with regard to this ?

[dasherman]

http://www.myfinances.co.uk/news/pensions/basi c-state-pension/buying-back-years-boost-pensio n-$1279615.htm

[factor-fiction]

It's worth listening to again

http://news.bbc.co.uk/player/nol/newsid_794000 0/newsid_7943800/7943833.stm?bw=bb&mp=wm&news= 1&bbcws=1

Here's what the Money Box site says:
People with gaps in their National Insurance contributions record between 1996/97 to 2001/02 have just three weeks to act if they want to boost the value of their state pension.

Voluntary or Class 3 National Insurance contributions can usually be paid for any of the previous six years, but because deficiency notices for the years 1996/97 to 2001/02 were not sent until 2004 or 2005, time limits were extended.
But not everyone can or should make up the shortfall.
We discuss the options with Malcolm McLean, chief executive of The Pensions Advisory Service.

[TCL-MUMPING]

You can pay what are called voluntary contributions in certain circumstances and the cost of each contribution will increase by 50% from the new tax year. You can listen to the programme here, http://www.bbc.co.uk/iplayer/episode/b00j22t3/ Money_Box_14_03_2009/

[Bazile]

Many thanks all .

I guess the first step is to get a pension forecast to see
if or how many years a person has missing - yes ?

One thing I didn't quite follow - the chap from the pension advisory service stated that if a husband was 5 years older that his wife then the wife would get 60 % of his state pension anyway
Does he mean that if the wife had not paid any NI , she would still get this 60 %
Can you clarify ?

[buildersmate]

The reason why 'not everyone should make up the shortfall' is because there is absolutely no point in accruing more Qualifying Years than earns one the maximum Basic State Pension. The rules are about to change from April 2010 when the number of QYs goes down from 44 to 30 (for men) and from 39 to 30 (for women). So for many people reach retirement age after April 2010, they will already comfortably exceed the minimum QYs anyway.
So whilst it is true the 'price' of earning a QY goes up sharply in April 2009, just make sure you actually need that year anyway to get to the magic 30 required.

[TCL-MUMPING]

If a married person, man or woman but usually a woman, does not qualify for at least 60% of the Basic State Pension, the spouse's contributions can be used to top it up to 60% provided that spouse has reached State Pension age and has claimed it.

I've not listened to the programme so I don't know what it covered but by paying the voluntary contributions it may mean a person qualifies for at least 25% of the pension. If a person is entitled to a lower percentage, NO basic pension is payable under present law.