Would this be enough of a pension for you?

[greenvoid]

Okay so

Dh and I have 3DC. Dh is older than me by quite a bit and it stands to reason that he will probably pass before me. Dh is the only financial provider in the house as I focused and still do on raising the family. I worked out the other day that I will not work enough qualifying years to get full state pension by retirement age and will likely be 6-7 years short of it. Let's just assume that I won't get any state pension for the sake of argument (I only currently have 6 years qualified). If DH dies before me, my pension from his employment will be £1500 a month forever (unsure currently about inflation rules with this). If you had a house paid off and 3 grown up children, would this be enough for you to live off?

Dh tells me how lucky I am to A) get this amount without working for it, which I totally agree, I am lucky and that B) people have to save a lot to have a private pension of that amount. Whilst that may be the case, it's possible that I won't get any state pension so it would be £1500 to live off solely with the assumption that DC are grown up, but who knows if that'll be the case. But for the sake of argument, let's say that they would be grown up.

Have you done the marriage tax allowance as well?

Ok but this means you'll get some state pension, unless you're likely to earn so little you'd be below the NI threshold. I'm not saying it's riches, but if you got say 50% of the full state pension that would add several hundred a month to your budget.

I know there's a pp about this, but just to reiterate because it's so important - you don't get to keep the money if you're over the threshold but you DO GET TO KEEP THE NI CREDIT.

The threshold is higher than £50k, but in any case, you can either choose to take the payment and then pay back the amount you're not entitled to at the end of the year, or you can opt not to receive the money but still get the addition to your NI record.

No woman (or man) who doesn't pay NI because of child care responsibilities should let themselves miss out on this - it's literally giving away some of your retirement income.

Couldn't agree more. If nothing else comes from this thread OP, do that! May as well start building up the NI credits now.

Hope?

Hope is a wonderful thing, what it is not is an investment in your future.

I think this should be your first step to being proactive about your old age.

You need your own pension arrangements especially as you don’t know what your DH’s requirements will be before he passes before you.

I think you really need to consider the bigger costs that can hit unexpectedly. At $1500 a month normal life is ok. But what happens when the boiler goes, then the roof gets a leak? Suddenly you are in a real mess.

I think you need to have a proper think about your financial future and how vulnerable you are. Don't leave it to your husband. There are so many threads on here from women who did this and then find themselves in dire straights.

Your husband should be supportive of you wanting to be financially secure as you age. If he is not, you need to question why. At a minimum you should be claiming CB even if it gets repaid through taxation once the threshold is reached. This will ensure SP. You should also have a SIPP, make the £2880 annual contribution and get the annual 25% uplift, it is literally free money. Why would you not do that if you have savings? A pension is just a long term savings plan, but a tax efficient one.

Take control of your financial future.

OP if you worked before DC and have had NI credits since the DC - I can’t see how 6 years can be right unless you were very low paid or are very young ? are there partial years which you can top up ?

It's not really realistic for someone on less than 50k to support a wife and three children and also save up for a really generous pension for both them and their spouse. There's not going to be a lot spare there unless you live in a super cheap area of the country

tbh that should be factored in to any decision for one parent to give up work.

if you can’t afford to live, including pension contributions for both parties, then giving up work is not the right choice.

women need to realise how vulnerable they are long term. It will affect them well into their old age. The few years where “my salary doesn’t cover childcare” is nothing in comparison. Go without for those years and secure your long term future.

even the “protection” of marriage isn’t enough, as spousal maintenance isn’t a thing. Once your kids are grown you’re left with no income other than what you can generate. No pension and you’re living hand to mouth or working until you drop.

£1500 would give you a frugal retirement so I would be looking to increase that. CB gives you qualifying years so even if you have to pay it back due to your DHs income I would continue to claim. Once the children are old enough I would go back to work.

I agree - what I was trying to get at was that I don't think it's very likely the OP's DH can actually fix it on his own, she either needs to accept a frugal old age or get back to employment

You can still claim child benefit and just choose to not receive the money. You will still get your stamp. The thresholds have also increased so it is from £60,000 now.

So if you have 7 years amd will get another 12 from when the new baby is born that leaves 16 years. Do you really not imagine that you will work for 16 years before retirement. ? Do you have any years with gaps that you can top up? What age are you now?

Grandparents doing childcare can even claim the child benefit NIC component if both parents are working:
www.gov.uk/government/news/looking-after-the-grandchildren-make-sure-it-counts-towards-your-state-pension

You haven't said how old you are but don't rely on state pension age staying at 68.

So he doesn't earn over £50k, but his pension will be £3,000 net a month? That doesn't sound right to me.

It depends on what sort of retirement you want / expect...

If you're wanting to drive around in a brand new car, go on a couple of cruises per year and lunch dates with friends several times a week then you'll be probably cutting it close.

If you're mortgage free - only looking after yourself and happy to drive around in a small economical car (if you drive) then I really can't see how £1500 a month wouldn't be more than enough to live a decent life?

By the time I've paid my mortgage and car finance each month I don't have £1500 left from my wages and still have to cover fuel / food / going out etc so for me £1500 a month sounds like plenty and if its genuinely not then i'll be in the same situation as you in a few years time with a Police pension :-(

You are lucky to be able to get £1500/month pension despite not working. I'll get half that after 25 years teaching! I will get state pension on top though.

Personally I would go back to work if I was worried about it all. You don’t have to work full time. I think I would find being a SAHM in a 2 bed house with 3 children a challenge. I would prefer to work & have more room.

It sounds like you must have been in a job before children as you mention another pension. It sounds like with £2k/year plus the £18/year from your husband's scheme you will be comfortable once state pension kicks in. It will be £31,500/year. You might just get a bit less state pension but as others have said you should get contributions due to being SAHM. It’s more than some get working with mortgage & bills to pay.

@greenvoid you don't seem overly financially aware so first thing I would do is to get yourself some independent financial advice.

You can still be registered for child benefit even if one is a high earner and you don't actually receive the monetary benefit, but being registered will ensure those years count towards your state pension.

Relying on your DH's pension as your source of income in retirement is bonkers. How would you survive if you were to divorce? Is it enough for you both to live on if he lives into old age?

Check your state pension calculator and how many years you're missing to get full pension.
Up to April 2025 you can pay NI contributions to go back to 2016 after April you'll only be able to go back 6 years.

£1500 really doesn't go far. Even without a mortgage or rent, once you've added up council tax, utility bills, insurances, car costs (if you run one - mot, service, tax, fuel, repairs), groceries, clothes and toiletries, occasional haircuts. Then you've got unexpected or other costs - house repairs, decorating, holidays. You'll want to spend money on your future grandchildren no doubt. I think you'd be living a very frugal life on that amount.

You can't have the cash but you CAN have the NI credits - you would be better off claiming it and paying it back (or I think you may be able to claim it but not take the cash, but I am not certain).

You can actually pay for missing years as far back as 2006 at the moment, but you need to look at this asap as this is going to change on 5 April.

Until 5 April, you can make up missing years of NI contributions going back to 2006 - 2016. Then from 5 April you’ll only be able to pay for the previous 6 years.

I would check your National Insurance contribution record as soon as possible because you may well be able to add some years of contributions and it may be cost effective to do so. I think that if a year is just missing a few contributions, you can pay for these at minimal cost. Do not leave looking at this until the end of March!

Whether it’s worth paying for years of contributions obviously depends on your age and circumstances.

IMO, £1500 a month is not a good retirement income yet will be taxed - obviously many people have to make do with a lot less, but with some planning now and maximising the state pension, you should b3 able to have more.