To be worried how I will manage to work until I am 67?

[brasty]

I am in my mid fifties. I already get more tired than I used to when younger. I wonder how I am going to manage to work full time until I am 67 years old. And continue to do my share of cooking, cleaning, family stuff and actually having some fun.

You can get a forecast, I won't get the full new pension because of being contracted out but I get almost exactly the same on the old pension because of I have some SERPS/S2P from when I was young and didn't have a pension. I think the difference was £1 and a few pence but I can't remember if it is more or less. I was relieved when I got the forecast as I knew I wouldn't get the full new pension.

I have always paid into a pension, although because I was low paid, my pension is small. TBH I might have been better off not bothering. I would have been happy to have paid the extra NI. You did not have a choice. In fact the reduced NI was sold as an incentive to have a pension.

So only since 2016 will I have paid enough NI for the new pension rate. So I wont get anywhere near the full rate. I read that 50% of people who have retired this year, did not get the new pension rate, because they had been contracted out. That is what the younger people here don't realise, that they will actually get a higher state pension than older people.

I suppose it depends how much you have lost on S2P, you £4k pension might be worth more but it is hard to work these things out. It is a worry, I have a decent pension but I hated paying it when the kids were young and we were short of money, I couldn't opt out of it but I would have if I could but it has worked out better in the long run.

I hope something might change for you.

Cross post so just read your last one. I know what you mean, friends who are a year or so older than me but retired a couple of year ago keep telling me at least I will be getting the higher pension and they don't believe me when I explain how it works.

I think it is pretty unfair.

It is harsh and it is annoying that the way they have presented it means people don't understand. How long have you got till you retire? I get my pension in a year which will be a big relief. Been hard going for the last couple of years with the drop in income but I had reached my limit. My husband has been disabled for over 25 years, my youngest two were a baby and a toddler when it happened so I was working, being his carer and bringing up kids. We all have our limits.

I Don't understand all the issues. I started work in 1981 at 21. Paid NI into state scheme for a few years, joined occy scheme at 25 and contracted out at 26. The contracted out money went into NPI where it grew from about 1994 to 2013. Someone contracted me back in. Had 7 years off with the DC. Worked part-time from 203-2005 and fulltime since. Been in occupational scheme since 2003. When my earnings met a reasonable sum again in 2013 I transferred a private pot, the NIP and a previous occur scheme into the new occy scheme.

I'm 57, have only to work another 18 months for a full state pension at 67, and if I retire at 65 will have 3/4+ of an occupational pension. I just paid into what was on offer at the time and happily took the employer contributions.

I was always aware of the importance and also that the retirement age was changing.

Out of interest, if you are not a homeowner, what happens when you retire? Is there a benefit that covers rent or are you on your own?

I Don't understand all the issues. I started work in 1981 at 21........

And this is why you don’t understand. In 1981 you could buy a house for a fraction of the average income. You couldn’t buy a garage for the same percentage now.

Not really in 1981 the interest rates were 15% plus. There was a world wide recession. A young person beginning work in the 80’s was not a walk in the park. But like Raindrops discussing pensions and pension schemes amongst my friends and family was commonplace.

They're not complex issues though, are they? Low-paid work, erratic work, no work, work that was interrupted by more than a brief spell of maternity leave, self-employed work, illness, disability, bad financial advice, time abroad, time in prison, time as an unpaid carer. I could go on all day. Settled, regular, decently paid work with a pension scheme and an occupational health scheme is a particular way of living/having lived that by no means extends to the whole population. Not difficult concepts really.

RaindropsandSparkles what do you mean you joined occy scheme at 25 and contracted out at 26. If you joined an occupational scheme at 25 you contracted out at 25, that was how it worked.

Have you got, or will you have, 35 years of NI contributions when you reach retirement age? Contracted out years get knocked off. So if you have been in an occupational pension since 2003 you might have been contracted out between 2003 and 2016 so those years don't count towards the new SRP.

Your years are confusing but I'm not sure you have enough full years of contributions to get the full pension. If you haven't they will work out what you were entitled to under the old scheme and if it is more you will get that.

Your right Mrs. it’s so easy for good plans to get derailed and sadly some never get the opportunity to put together a good plan.

SusannahL - please detail these fantastic opportunities... ?

Some of these may have existed 20 years ago, but now??

Not really in 1981 the interest rates were 15% plus.

This is true. However the cost of monthly mortgage payments were a much smaller fraction of a household income.
My parents bought their house in 81 for £13k. It’s now worth £500k.
In the jobs they had then there in no way they could afford it now.

in 1986 my mortgage payments were over $1000 per month with a much lower wage.
we bought our first home for $73K in 1986 in a very remote isolated village it never did gain much more value. we did sell in 2014 for $325K in a rare (once in 30yr) blip in the market when there was solid talk of expansion. which has since not happened and housing prices are back to much much lower value.
as the interest rates came down in the 90's and our salaries rose we were able to pay off the mortgage earlier than some.
we then invested in land to build on. not wanting the hassle of renters.
we worked in an industrial town with an aluminum smelter and a pulp and paper mill as well as another industry. good jobs, good wages, excellent safety improvement.
sadly the mill closed, the smelter modernized and the other plant shut down it's main operation but maintained it's port.
everyone always discussed the retirement exit strategy.

Perhaps the most sobering thought around paying in for the state pension is that to invest in a private pension to gain the same paltry amount, a woman would need to have built a private pension pot of around £265,000 and a man around £240,000.
These are very scary amounts. Education is the key, going forward. This in no way helps the destitute of today, however.

because women outlive men....interesting

I Don't believe you had to contract out of serps to join an occupational or private scheme. It was diverting the contribution from one to the other.

Paid NI from 1981-1996
7 years off counts towards the pension
15 plus 7 = 22
Worked p/t 2003-2005 = 1 + 22
2005-2017 = 12 = 34
1.t years of contributions to go.

You were automatically contracted out of SERPS. It was not a choice

I don't believe it was automatic, I remember there being a choice. SERPs related to earnings.

If people have worked and contributed for 35 years they will get a full pension. If they have also had private or occupational pensions they will get that too. Alternatively people can make other arrangements to fund retirement.

Personally I'm thrilled to be able to work until 67 if I wish. If I can't I'll have an occupational pension to breach the gap and if that wasn't enough then we'd have to release some money from our house.

I had no choice, I think it depended on the pension. Remember for low paid people a full pension can be very low.

Isn't a full pension c£8k per annum regardless of earnings. I am grateful and surprised that I have 7 years' pension credit for the tears I spent at home with the children not working. I think it's amazing that women get this.

Equality works two ways surely and bearing in mind the actuarial costs and valuations, the male age was never going to be lowered. I started a new career at 43. Having 20+ years ahead of me meant I was taken seriously. It has made a huge difference go me professionally and positively so.

Of course a full pension is not £8k regardless of earnings. Where do you get that from??