Early Retirement

[sretiolc]

If I take early retirement at 60 and just survive on my Superannuation pension will I have to continue with my N.I contributions ? I don't get my state pension til Im 66 ..........??

[ubasses]

If you are in receipt of a pension you do not pay NI, but you need to check if you have enough contributions for a full state pension. If not it may be worth looking at paying voluntary contributions to increase it.

[sretiolc]

okay -thankyou

Would I have to write to HMRC or do you think they could advise me over the phone ??

[Hymie]

My understanding is that you will continue to pay NI (on any salaried income) until your reach state pension age – regardless of the number of qualifying years paid.
But you will not pay NI on income from a pension.

I am currently drawing income from a pension, and I can assure you that I am paying NI on my salary – because I have not reached state pension age.

[Tilly2]

If you do ring them, sretiolc, do it in the evening. Don't ring during the day unless you have an hour or two to spare.

[Hymie]

Some further information to assist you – you now only need 35 qualifying years of NI payment to claim a full state pension (it used to be 44 years).

Bear in mind that if your company pension was contracted out – then these years will not count towards the increased state pension (of circa £7k/year).
The calculation as to how much you will receive is complex – but HMRC should be able to advise.

[boxtops]

Have a read of this http://www.nidirect.gov.uk/early-retirement-effect-on-your-pension

[murraymints]

you can request a pension forecast which tells you how your contributions are..if you have sufficient for full pension or not..contact HMRC with NI no..date of birth and they will send it out to you..

[boxtops]

Good point, murray - I used to request a pension forecast every couple of years, so I could plan ahead.

[sretiolc]

thankyou all for your great advice
:)

[murraymints]

:o)

[Sipowicz]

I have just phoned the Future Pension Centre helpline for a state pension forecast. I was expecting to be on the phone for ages, from picking the phone up to hanging up, less than 5 minutes, pleasantly surprised!

[Hymie]

Something else to consider:-

If you stop work, but don’t claim your pension, you could claim Job Seekers Allowance (circa £70 per week) for up to 6 months, based on your NI contributions (over the last 2 years). As a result of delaying taking your pension, you should get a slightly increased pension payout.

If you ask your company pension service, what increase you would get by taking such action – you could then decide whether such a course of action worthwhile.

Of course you would have to pretend that you were looking for work for 6 months, but once you are in receipt of a pension – you cannot claim JSA.

[factor-fiction]

That's true Hymie but there are lots of conditions attached to JSA. When I first signed on I had to go in three times in the first week to register, then discuss carreer option/CVs then sign on. And I would have had to go in twice a fortnight- once to sign on and once for a job search review/coaching session. More importantly you have to set up an online account with the universal jobsmatch site and are expected to show you have applied for something or at least done searches every day- and your activity is logged so they can discuss it.. if you're prepared to put up with all that for around £70 a week that's fine.

[factor-fiction]

Oops- I can spell career. This is what happened when I signed on in January this year. Fortunately I got work again within two weeks but it was clear that they are asking job seekers to look hard (or pretend to look hard) for work. However I did wonder whether everyone was doing that- I saw claimants just acting dumb and claiming they couldn't read or couldn't use a computer