Independent Financial Life Planners Bishop's Stortford: State pension pay-outs to consider

Thursday, 2 July 2015

State pension pay-outs to consider

Enable’s IFAs in Bishops Stortford always take note of the state pension as part of a retirement or pension plan and since the new state pension has been revised it too is aimed at simplifying the system. From April 2016 those of pensionable age will see a single payment of about £150 made to new pensioners a nod to a fairer system. But concerns voice earlier this year suggest that maybe on 45% of new pensioners, some two million, will be entitled to the full, flat-rate state pension in the first five years of the system.

A freedom of information request submitted by Hargreaves Lansdown revealed these figures showing how some private or workplace pension provision are contracted out of some of the state second pension, which is being integrated into the new flat-rate state pension. This could mean that they will receive a lower amount and others have gaps in their National Insurance contributions.

On top of this from April 2017, people will also have to work longer, making 35 years' worth of National Insurance (NI) contributions, rather than the current 30, to qualify for the full pension. If you have only paid NI for just a few years you will not qualify for the new state pension at all.

"The new state pension will ultimately be a simpler and fairer system. However, in the short term it will be complicated and many people are likely to get less than they may expect," said Tom McPhail, of Hargreaves Lansdown. If you want to have a review of your pension forecast and include your state pension in that Enable’s IFAs can help make sure you are not in line for any nasty shocks.

Issued by: Enable Independent Financial Life Planners  25c North Street, Bishops Stortford, Herts CM23 2LD Telephone: 01279 755950 - Fax: 01279 657339  Enable Independent Financial Life Planners is a trading style of Enable Independent Limited is authorised and regulated by the Financial Conduct Authority. It is important always to seek independent financial advice before making any decision regarding your finances. If you would like any assistance, please contact us. NOTHING CONTAINED IN THE ARTICLES SHOULD BE CONSIDERED AS GIVING INDIVIDUAL FINANCIAL ADVICE

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IFA Bishop's Stortford

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