Request for advice/guidance on buying back NIC missing years

[fosunfan]

Thank you for taking the time to read this and also in advance for any responses.

I've learned so much from this sub-forum over the last week or so, reading back through many months worth of contributions. Please excuse my first post being a query.

My 28 year-old daughter is (hopefully) taking up Full-Time employment in the NHS this Summer following a career change and a further period of study.

I would like her in the future to at least have the option of being able to retire early and be independent enough to do so around the age of 55. Her State Pension age will be 68.

She has two Full Years of Contributions (13/14 and 15/16).

My understanding (which could easily be wrong) is that under current legislation she needs 35 Full Years to be eligible for a full state pension.

So ... 28 (her age) plus 35 would bring her to needing to work until she's 63 to be eligible, so buying back years should make sense.

When she spoke to someone at HMRC on the phone yesterday (because we're trying to buy back before the price rise in April), the person she spoke to said that she didn't think it would be worth it and that given her age there wouldn't necessarily be any financial gain in doing so. The only way this makes sense to me is an assumption that my daughter would carry on working until age 68 and would, in that scenario, have enough time to get 35 years in.

If anyone is able to offer any clarification or guidance or point me in the right direction in case I'm missing something blindingly obvious, I'd really appreciate it.

Again, many thanks.

Best Wishes,
David

[mikeiow]

I'm no expert in this field, but we are looking to do the same for MrsMikeIOW......I wasn't aware of the April price rise (but I assume that is a regular annual inflationary increase?), & we are now too late to sort that out (off to the ski slopes later!!).

It does seem to make great sense to me to put it in if you can....but 35 years is a long time in pensions/governments, so who really knows!?

(maybe someone else will chip in who does!)

[Mr Pointy]

Usually you can only buy back 6 years & two of those she has contributions for so you are looking at four years if you manage to get it done in the next couple of weeks (or three years if not). It's quite possible that your daughter will lose more years if she has children so you could say that catching what you can now is a good idea.

Is she actually eligible to make voluntary payments?
https://www.gov.uk/voluntary-national-insurance-co...

However, no-one has any idea what the situation will be with state pensions in 35 years time so another plan might be to put the money into a pension plan for her & hope/trust that it will grow to provide her a bigger pension form the age of 55 or whenever she does manage to retire.

[fosunfan]

Thank you both for replying. Your contributions helped push us towards a decision.

I think what we're going to do is:

- buy back now a couple of the years, where it isn't too costly to do so
- look at sensible pension options with the remainder once she's got a job
- possibly buy back one more year before April 2020 (this will cost us slightly more than if we did it now, but I'm happy that the additional cost - if we go this route - is actually buying us thinking and planning time)

Best Wishes,
David

[craig1912]

Buying back the years doesn’t make sense for someone of age 28. You have no idea what the state scheme rules will be in 20-30 years time. Put the money in an ISA or something as there is no point paying money to the state when you don’t know if there will be any benefit.