Should I back-pay NI contributions?

[Cameliah]

I studied for a MSc then I went back as a mature student and did a PhD. So I was a full time student for over a decade in total and didn’t pay NI contributions during those years. I have 25 years left until retirement age and I need another 19 years contributions to get full state pension. I’m currently a SAHM, I hope this will change when my youngest starts school.

If you were me, would you start back-paying NI for missed years at this point? I have 5 years (while I was studying for my PhD) which I can back-pay if I want to. I don’t have a private pension and I’m not likely to be able to afford to pay into one, so I really need my full state pension.

@Dyrne

I think you need to focus on seeking treatment for your depression and learning coping mechanisms; since you seem stuck in a “doom spiral”.

There are plenty of options out there between “University lecturer” and “Minimum wage”; but you seem to think those are the only two options.

Once your mental health is better you’ll be in the right mindset to find something.

Some options are:

Civil Service
Local Government
NHS
Schools

All of those would pay over minimum wage plus have decent pension schemes. Might take a little while but what have you got to lose?

Many big companies now have specific schemes aimed at getting women back into work after being SAHMs, so worth looking at those as well.

This post is spot on.

I agree there are currently loads of jobs advertised on www.gov.uk for civil service, NHS, Government, etc

In your position no I wouldn't as you've said it would be a stretch but I would be looking for low wage jobs with prospects as others have said 'once you're in the civil service or local council...' Also look at the charity sector.

Our area has just been recruiting for graduate entry into the police force. A bit of life experience is invaluable.

Or make a start by being an online history tutor. Not all tutors have teaching qualifications and it could be in the evenings.

I am one of those who was due to get pension at 60 but they moved it to 66.
In spite of working for 35 years I still have gaps in NI conts.
I looked into it recently and paid about £3000 for back conts.

You have time to play with so it's not desperate.
Get a pension forecast and work out whether it's worthwhile.

The one thing I would say is that the amount you have to pay for past years increases every year. So if you wanted to pay for 20/21 it will cost more after April than it does now.

Obviously you want to get to the point of full contributions by the time you are 67. But do you actually want to work in the later years of your 60’s if you have the opportunity not to?
You don’t mention a partner, but if you have one, might they retire at any point before you are 67?
If so you might want to work out in theory when they could retire, and try and make sure you have at least got your contributions complete by then.
I’d say top up the partial years as and when you can so that you have a bit more flexibility about how much you work in your 60’s.

I owe a few years from when I when we was studying. The HMRC themselves told me to wait untill I was about to retire rather than pay it now, not least because there was no guarantee there would be a state pension in 20-25 years time.
I was slightly below the NI contributions threshold to claim Maternity Allowance for my second baby, to top up my MA payments from £40 p/w to £140 p/w I had to pay the grand total of £6.30. Absolutely bonkers.

FWIW
Lots of people have degrees & do jobs that are unrelated. Some degrees provide a broad knowledge base which is a good foundation to build upon.

The last job that I did, was not invented when I was at university & I learnt lots of new skills whilst doing the job

Think willingness to learn
Transferable skills
Good written & verbal communication
Etc

I looked into this as being a SAHM turned into early retirement (children now 14 and 11). We didn't qualify for child benefit so I pay for the gaps. It wasn't a lot if I seem to remember, and it means you get full state pension, not that that's worth much!

@Cocomarine

You can only make voluntary NI contributions for the last 6 tax years. Given we’re almost into a new one, and you’re talking about 5 years of your PhD, and didn’t have a child then but do now… are you not on the verge of losing the 6th year? In which case, I’d get that one paid for, then make the decision year by year. I’d say do it though!

As for credit when on benefits… it’s surely worth dealing with the system for such a long term benefit?

This is what I was going to suggest. Pay for the oldest year and make a decision each year, always paying for the year you are about to lose out on.

I was offered the chance to pay for my years at Uni (1996-2000) and I had no money so chose not to...now I wish I had!

I did in a similar position to you. Gives me peace of mind to have years in hand.

@Cameliah

Why not if you can afford to?

I can’t really afford to. It would be a stretch and we’d be doing without other things in order to back-pay the NI. I’m just nervous about not getting my full state pension because I know I won’t have any private pension.

I'd say that you're not at the point of needing to consider this yet. Especially with retirement ages rising.

Also please note, you will be autoenrolled to an employer pension when you do start work.

Just check with the Pension forecast people because IIRC my NI was credited for the year when I studied for my Master's.
I received a grant from the funding body. Similarly PhD. Might get it for free!
PS I started my grad scheme at 32, don't be ageist against yourself! Consider adult apprenticeships many government departments offer them

Go onto the government website and set up an account. You can track your NI years and also get a pension forecast. It's really easy to do and much more reliable than second guessing.

I meant to say that the reason I'd keep topped up is because the number of qualifying years is essentially a political decision.

What's to say a later Government decides to increase the number to 40 years?

Non academic university jobs are also a good option with lots of benefits.

Even if you just start out as an admin assistant if you are a good worker there will be room to progress and they will value your academic qualms even if not 100% relevant

I may be wrong, but if you are short of years when close to retirement I think you can buy class 3 contributions to make up the shortfall?

The Civil Service gave me a job at 55, with 15 years out of the work place. Yes, it's an AO job, but lots of us there are grads and postgrads. You can progress if you want, or you don't have to. I'm really enjoying it.

'Older' years are cheaper to pay off than newer ones .Get a state pension forecast to check your actual position. It will show the gaps and tell you which years you can backpay.
www.gov.uk/check-state-pension

I have 25 years left until retirement age and I need another 19 years contributions

8 years of child benefit claiming, then 11 years working. That will bring them up to speed.

Agree look at civil service. I’m a civil servant and I do recruitment as we don’t decide if people are over qualified. We score the application on its merits, don’t really look at qualifications unless they are requested as part of the application (one I do don’t require qualifications but latest scheme I’ve seen many teachers and graduates). Also I disagree about graduate schemes all being for young grads, my friend is doing a graduate scheme with HMRC and is a 40yr old with 2 kids. Civil service has a good pension, I’ve got 21yrs towards mine now and it’s definitely a good scheme