pension & NI contributions

[isitshe]

I freely, but embarrassingly, admit that up until recently I knew naff all about pensions. I didn't work for a couple of years when I had a toddler & a baby, returning part time a few years ago & I've since returned to education. I consequently have a gap in my NI contributions which I didn't know about, I didn't know there was something I could've done to keep them running when I was a SAHM, and I have only recently started a private pension to augment my paltry workplace pension. It should be a bit healthier when I graduate & get back to FT work.

Can someone tell me if you can make up NI contributions missed during gaps in earning so you can still qualify for a full state pension?

I think this stuff really should be taught in schools btw.

As an aside, I was paying off my credit card today & something occurred to me - are you seen as a less desirable customer if a credit card company doesn't make money from you through interest?

You need to register for a government gateway account so you can see how many more years of national insurance contributions you need to make to achieve the maximum state pension.
Then I would recommend watching the Martin Lewis Pension programme which was on last week. I imagine it will be available to watch on ITV X.

Yes you can pay up the shortfall in your NI contributions , when you were a sahm if you were claiming child benefit that covered your contribution as credits , when you went back part time if you were not earning enough that's what affected your contributions .

Thanks so much! Both really helpful replies 🙂

The only benefit I see in not paying your CC bill in full in for the bank making money off you. In fact having a unpaid balance is likely to affect your ability to get a loan/ mortgage if you let it get bad.
For your pension, can you consider increasing your salary contributions via salary sacrifice? You would make a small saving in how much NI you pay that way.

Thanks Brambly, the cc thing was just something I was curious about, as I always pay it off before I get charged interest. I wouldn't change paying it off in full - debt makes me anxious! I use it to build points/vouchers & because it seems more secure than using my current account-linked debit card for everyday spending.
Unfortunately, I'm not in a position to increase my salary contributions yet, but I've got a private pension on the go now.

Do check the Money saving expert programme or website to see whether worth/able to pay voluntary years. There's a deadline this April to be able to pay back 2006-2016 years.

Also worth noting that you need 35 years' worth of NI contributions to get the full state pension, so whether it's worth buying back the missed ones might depend upon whether you're already on course to get 35 years even with the gaps?

www.gov.uk/new-state-pension/your-national-insurance-record-and-your-state-pension

I've recently done this. The deadline is 5th April.

I now have the full 35 years of qualifying NI contributions and it means that when the time comes I will get the full state pension of £185 per week rather than just the £130 something that I was otherwise likely to get. I recommend doing it if you possibly can.

I also have a private pension which I am currently drawing down on in a very limited way for now.

You only need to pay for missing years if you are nearing retirement age and don't have enough time left to make those years up.
As a previous poster has said, any years you were not working but claiming Child Benefit then that gives you NI credits for those years.
You need to make sure your part time earnings are paying enough NI to qualify for a full years contributions (around £12.5k). If not then as long as you still have a child under 12 then your Child Benefit will give you the credits you need.

People who don't pay off their credit card in full may get higher credit limits and higher interest rates offered than those who do, but it's not a given.
As far as credit scores are concerned, it's mainly about not missing any payments rather than paying it off in full.
Apparently it's good to have a large credit limit but only use around 25% of it and it doesn't matter if you pay it off each month or run a small balance but pay more than the minimum so you are clearing the interest each month and bringing the capital down, so somewhere between the full balance and the minimum.
I just use ours for large purchases like holidays for the protection then do a 0% balance transfer from another card and pay it off over 12 months.

@Fizzadora I thought that if people worked part time and did not earn enough to pay NI then the employer paid it?

Thanks so much for the replies. I set up a government gateway account and I do have 3 missing years, but they are from when I was a teenager.
First job was cash in hand.
It turns out I have 10 more years to make the 35 qualifying years. I'll be in work for at least twice that!
I was worried about the SAHM years so thanks to all who said that getting child benefit covers those years - v. relieved!
I have very little in contributions for many of the years to date though. I really don't understand how it works so I will watch the Money saving expert programme to try to get a handle on it.

It's been extended to end of July.

“I think this stuff really should be taught in schools btw.”

Teach what though?
Detailed pensions legislation that could easily change?
You were interested enough as an adult for a good few years, would you really have found it relevant enough to pay attention when you were 15?
There isn’t curriculum time to teach everything.
I think it’s better to focus on literacy so that pension information is easily understood when people decide they want the information.

I think the deadline has recently been extended to July.

You need to make sure the child benefit was/is claimed in your name to get the NI credits also.