Quote:
Originally Posted by Dawn
I have also been told because I contracted out with SERPS for a few years I won't get full pension. The thing that REALLY annoys me, is that by the time I retire I will have OVER my full 35 years contributions not counting the SERPS time, so how can they justify taking money off me.  |
It’s “the law” Dawn - and to be honest I think it is quite generous.
We only need to work for 35 years to accrue what is now quite a generous State Pension. They Scrapped SERPS and the Second State Pension (S2P) because it only benefitted the well off.
The low paid never paid enough NIC to qualify for a good SERP (State Earnings Related Pension) but the high earners did. So not only did they get a good occupational Pension but the State paid them the standard OAP and a good top up via SERPS. - the clue is in what SERPS stands for.
If you were low paid or self employed you either didn’t earn enough to qualify, or if you were self employed you were not eligible for SERPS benefits.
The new system gives everyone a good solid State Pension and all you have to do to get it is to pay NIC for 35 years.
Dawn - if you contracted out of SERPS - it means that you opted to take a rebate on your SERPS contributions and have them paid into your own pension or the pension scheme of your employer.
So it would seem that you have a Private Pension Scheme or membership of an employers pension scheme that you can access. If you are not sure what you have it would be wise to check it out. For example if it’s in a Personal Pension I suspect it’s in a cash fund - which was, in the past, a good option being safe and getting reasonable interest.
But these days a cash fund may only be getting 0.75%pa and most old Personal Pensions have annual management charges of about 1%. - So whatever you have in the plan could be steadily declining in value. If you can find out what it is a simply matter use a less expensive plan and/or a better fund choice.
If you want to know your personal options are rather than discuss it on an open Forum then PM me and I’ll do what I can to help.