State Pension- opting out?

[Jackleman]

Hi,

I am 32 and have been making national insurance contributions since I started work, some of this time I was self-employed and paid the minimum statutory amount and at other times I was taxed to the hilt when on PAYE.

On the basis that the state retirement age will be around 80 by the time I get there and I doubt the pension would be worth much, it seems prudent to opt-out and look to plough more money in to my own pension and other investments?

What does the panel think - good idea or silly? any advice.

Cheers

[Welshbeef]

Your talking about 2nd state pension.
I've been opted out for all the years I'm in a final salary pension but that's because the pension fund force that.

[RichyBoy]

I don't trust private pensions myself, at present I have a single max holding of an indexed linked national saving cert which I plan to hold for 30 or 40 years.

In regards to the state pension, is it the same for everyone regardless of wages or length of employment?

[J500ANT]

http://www.direct.gov.uk/en/Pensionsandretirementp...

is this of any relevance? It appears the contracting out is ending 2012.

Changes to contracting out from 6 April 2012
From 6 April 2012, contracting out of the additional State Pension will be abolished for certain kinds of pensions. From this date you will no longer be able to contract out of the additional State Pension through:
a personal or stakeholder pension scheme
a company or occupational pension scheme which is contracted out on what is called a ‘money purchase’ or ‘defined contribution’ basis
If you are contracted out through one of these schemes on 6 April 2012, you will automatically be brought back into the additional State Pension. You will begin to build up additional State Pension from this time. Download ‘Contracted-out pensions’ to find out more.

[Welshbeef]

So no point then for a year.

QED

[ringram]

Better to not bother paying NI at all.
You still get 60% of a fully contributed state pension anyway.

[Welshbeef]

ringram said:

Better to not bother paying NI at all.
You still get 60% of a fully contributed state pension anyway.

I've just today had the annual pension statement so what my final salary is what the expected state pension will be c£7k and then second state pension c£3k. So would I want to lose out on c£4k pa best guess from today's info? Nope. Will the pension state be the same as it is today nope however at this point in time it is the best option and in 14 months time academic.

The real secret though is to spread the risk so not all eggs in one basket

[ClassicMercs]

Do you have an IFA.

For last couple of years the recommendation seems to have been to Contract IN. Google for the link to the form to fill in - something like a CA1543 - but check - everyone is different. Just done my own.