How remiss - again. I have just realised that the rather short entries for October and November of my War Diary have not been uploaded. Now I have done so. As I say, short and sweet!
Onto Pensions. Other than staying at home to bring DS up for a few years, I have always worked. Mostly 3/4 time i.e. 6-7 hours a day, sometimes part time - around 4 hours. Whilst abroad, I worked full time, still paying my N. I. contributions - luckily as it turned out!
Before retiring early, I made sure I was fully paid up, as in having the full 30 years contributions to receive the full pension when it becomes due. Then the government moved the goals posts - now I need to pay another 5 years of contributions, in order to receive what I was once entitled to:(
We have both saved hard throughout our lives and continue to do so. Any £'s on the day the next pension is due (DB not me yet) are transferred into a savings account - it all adds up over time. That is why we live a relatively frugal life, not as hard a life as we once had no alternative but to live, but a happy medium that allows us to be careful, save, and still enjoy ourselves occasionally.
I have already paid one of those five years. The annual payment rises every year that is left. If I had realised I could have started this process earlier it would have been cheaper!
Do we break into the savings and pay it all and be done? That would be the easiest option but we could pay it yearly (and I think you can do it monthly but am not sure). In that case, although the interest rate is low, we would be earning the interest on the amount still owed rather than the government. That is probably the best route.
Some would say "Why bother?" My answer is this, the difference in weekly payments if I don't pay those extra 4 years is £20. Not much to some but over a year, that is £1040 - a big difference. Every year that I pay gives me a few more pounds a week, for a lifetime.
"What if you die beforehand?" Well, none of us know when we will die. If I die before I receive my pension, I feel I would have contributed into a system that would ultimately benefit others. So hard luck for me but DB would financially be secure due to his own pension, so no worries there.
Next time - Can you afford to live on your pension if the government pension was all you had?
That is it for this week folks, have a good weekend.