Is it worth topping up my NI contributions?

[Coffeecoffeeinmytummy]

Hi all, I'm aware there is a deadline coming up for when we are able to backpay/top up previous years of NI contributions. When I log into my government gateway account, I am told:

12 years of full contributions
33 years to contribute before 5 April 2055
7 years when you did not contribute enough

The 7 years were all during the time that I was a student and working in part-time jobs that never got me across the threshold to count as a full year of contributions.

I am 35 now. I have 33 years left in which I would need to make another 23 years of contributions. On paper I think that seems ok (certainly don't have a private pension that I anticipate being big enough to enable me to stop working before age 58!) but I do have some health issues so I'm worried about not having sufficient years of contributions to qualify for the full state pension. Most of the years that I'm missing would require me to pay an awful lot to top up to qualify (£600+ per year) but there is one year where I must have already paid a bit of NI as it says that I need to pay £63.40 more for it to count as a qualifying year. Do you think it's worth doing? Or is it a waste of 60 quid?! Thanks

This article explains about the current extension to allow you to pay back years beyond the usual 6 year time limit.

The extension has been pushed out to July 2023.

At the bottom of the article is a link to another which explains the pros and cons of whether it’s worth it.

www.moneysavingexpert.com/news/2023/03/state-pension-boost-deadline-extended-july/

Thanks, I had seen similar info on the government website but I'm still not sure if it's worthwhile really. WWYD?

They may change the amount of years you need, I am sure it has been 30 years and 40 years in the not far distant past so I bet by the time you retire it would have change several times, it's very difficult to know what to do when you are so far away and who knows what changes governments will make.

I'm 65 and retired with a private pension 3 years ago, my forecast says I have 46 full years but if I buy another year I will get the maximum pension but then it says I contracted out for some years so I will get less for those years. I won't be paying the extra contribution as it doesn't really seem that worth it for me but I was surprised that 46 years wasn't enough.

The way I understand it - If you have 33 years left to make 23 years worth of contributions I wouldn’t personally be paying any extra.

Even if you do end up leaving work early, you can still pay to top up your contributions at that point to make sure you get the maximum amount before state pension age.

NI contributions are counted from age 16, so many younger people nowadays will not have full years until they leave university so many will be in the same situation as you OP with part years, I started work at 16 like many did in the 70s so have full years from then but very few will now as you have to be in education until at least 18.

I wouldn't pay the extra at the moment OP as your situation with contributions is very normal for your age, my DS will be in the same situation with his as he was not earning enough in his student jobs for it to count

I’d probably pay the £63.40 to complete that year (the cost of buying additional years might change in the future). Re your ‘health issues’, if at some point in the future you find yourself claiming benefits, such as ESA, DLA, etc. remember that these will include National Insurance credits - so you will accrue additional years that way. The bottom line is, there are no prizes for accruing more than 35 years !

Martin Lewis mentioned it on his show, its really for over 45s, but as pp says it would not hurt to pay the £60 one

I would pay the £60 one.

I'd buy the year for £63. You never know what your health will be in the future.

Pay the £60, that's not much to get an extra year. According to Martin Lewis that's £275 per year you will receive in pension.

At the moment if you have to stop work due to ill health the government credit your NI record. Who knows if this will change?

I had to give up work due to disability, I'd worked for the NHS and I was able to claim that pension. I think it is probably worth spending money to see a financial advisor.

You may be better off starting a private pension / SIPP/ stake holder pension so if you do need to give up work you could get access to that money.

www.moneysavingexpert.com/savings/voluntary-national-insurance-contributions/#:~:text=A%20full%20NI%20year%20usually,your%20pre%2Dtax%20state%20pension.

The deadline has been extended according to the news, by a few months