state pension

[Connemmara]

just been told by my friend she will be receiving £147 pension - now she is married coming up to 61 and will be getting £147. Another similar person only getting £125. How come. Should she check this = this other friend by the way never married. /First friend's husband has just retired last week. how do they work all this out. i will never know

[ladyalex]

Sorry to have given a bum steer re the pension forecasts.
I had no idea.
My days of needing a pension 'forecast' are now long gone. :-((

[ladybirder]

The more you pay in the more you get out. I paid 20 years of SERPS to increase my pension.

[FredPuli43]

Complete mystery. Just turned 65, I get £115. 20, rising to £121. 08 on 10/4/12. What puzzles me, is that they now want a copy of my divorce decree absolute, because I may get more money once they have official proof of the divorce. By what logic can I get more money for being divorced (ten + years ago)? I am as single now as if I'd never been married!

[ladybirder]

Could it be that your husband's contributions would also cover you for the time you were actually married?

[THECORBYLOON]

New Judge, there is a clear warning here,
http://www.direct.gov.../DoItOnline/DG_189931

"Women born on or after 6 April 1953: men born on or after 6 April 1951
At the present time you can't use the online service to get an estimate of your State Pension if you’re:

• a woman born on or after 6 April 1953
• a man born on or after 6 April 1951

We recommend that you do not enrol with the Government Gateway until the on-line service is again available for you to use.
In the meantime you can get an estimate of the State Pension you may get by using the State Pension profiler or asking for a State Pension statement."

[ladybirder]

Sorry Fred, dropped a clanger, forgot which gender I was replying to. X

[craft1948]

I didn't expect a full pension when I retired as I'd paid reduced stamps when I was married to the first Mr Craft. Surprisingly, because we had divorced, my reduced stamp years were covered by his contributions so I got the full whack. If we had stayed married I wouldn't have.

[factor-fiction]

Ladybirder:
Regarding: "Factor >it seemed that the more savings you had the pension credit was reduced<
That's exactly how it was meant to work."
I understood that aspect of pension credit. But there was also something called savings credit which promised to reward you for savings. I wondered whether it was a misleading statement designed to get people to reveal their true savings so the DWP could keep pension credit costs down

[FredPuli43]

Maybe, ladybirder, but I'm a bloke ! Joking aside, you may be on to something that applies equally to divorced husbands, that in some way the ex-spouse's contributions affect the pension.
I was thinking it was a reward for getting divorced from the poor woman !

[mojay]

back in the '70s I was a working mum with 3 littleys and paying the reduced stamp. Women were then all given the option to pay the full stamp or still take advantage of the reduced version. I struggled to decide but eventually chose the full stamp whilst my colleague decided to still pay the 7p or whatever it was then. Am I glad I chose to pay the full stamp ? - you bet I am !

[237SJ]

I can`t remember exactly but savings credit is worked out at something like every £500 of capital counting as £1 of income. That includes house, savings, shares etc. If the sum total is less than a certain amount, the person gets savings credit. My mum had £6 per week savings credit and when the pension increased recently, the government took back £3 of it!

[THECORBYLOON]

From April 1978 to April 2010, Home Responsibilities Protection (HRP) meant that rather than replacing National Insurance Contributions, it reduced the number of Qualifying Years needed for a full pension and it does not work out to be the same.

It didn’t apply to women who were or could have paid the reduced rate stamp and the HRP could be awarded only for complete tax years.

It changed in 2010 and it does now mean that credits will be awarded for each each rather than having to be for a complete year.

[THECORBYLOON]

For widow(er)s and divorce(e)s, the former partner's National Insurance contribution record can be used to improve a person's pension entitlement so that is why a Decree Absolute needs to be provided if a claimant has been divorced.

[THECORBYLOON]

The Pension Credit rate for a single person is £142.70 per week and they can get a maximum of £18.54 on top of that as a Savings Credit if they are 65 or over.

[factor-fiction]

Exactly, 237SJ- the impression is given that pension credit is a reward for savings, but very quickly the opposite happens and you are penalised by a reduction in pension credit.
It's a mess.There is little incentive to have savings or have a modest private/company pension it reduces entitlement to credit/housing benefit etc.

[ladybirder]

Factor I remember what Gordon Brown said at the time he introduced the Savings element of Pension Credit. It was that he was responding to people who felt that they were being short-changed by saving for their retirement or who had built up a small works/private pension because pensioners who had made no effort were rewarded with Guaranteed PC. These people, he said, he would reward with Savings Credit if their pension was under a certain amount but over the Guaranteed PC limit. It's means tested and it was only paid at 65 not 60. I can't give you the actual figures I'm afraid. But I do know these people have lost out since April, some having lost all of their Savings PC because of the larger than usual rise in the SP. This Government isn't committed to it, I don't suppose we can afford it. I heard it being discussed on MoneyBox on R4.
I do hope you can make sense of what I've said - it's not easy to explain.

[ladybirder]

Lots of pensioners got the Savings top-up factor, it didn't take away from anything else. The DWP was swamped with folks claiming when it was first introduced.

[factor-fiction]

Thanks. i never got to grips with it. The system is too complex for many pensioners and it's not surprising many don't get all they are entitled to.

When my grandmother received a small legacy from her sister around 10 years ago it took her above the savings limit (which was then only £6000 I recall) and she lost some benefits- but maybe that predated the pension savings credit. And when i looked at whether my MIL was entitled to it for having small savings of around £5000 a couple of years ago we were told no. I'm usually quite good at financial matters but couldn't work out this element of the pension system.

[ladybirder]

It makes you think they make it as complicated as possible so nobody knows whether they are getting the correct amount or not. I must admit a £140 or £150 a week SP should clarify things a bit. At least for the new pensioners.