Flying Into Another State Pension Fiasco

The so-called WASPI women (Women Against State Pension Inequality) hit the political spotlight during Labour’s general election campaign.

Whether you agree with their plight or not, one thing that is beyond dispute is that they clearly didn’t know about the changes to their state pension entitlement until the last moment, i.e. when they wanted to make a claim.
The realisation that what they were expecting isn’t what they were going to receive brought major disappointment and anguish.

The problem was communication, or lack thereof. The changes affecting the WASPI women were announced in 1995, so how did they slip under their radar? Unfortunately, governments of all colours seem to believe that the unsuspecting public has infinite time and a desire to understand the implications of policy changes, even when they are hidden or at the very least, unforeseen.

So, have our current leaders learned from past mistakes? That’s rhetorical by the way!

The hidden cost of losing child benefit

It is my belief that we are currently sleepwalking into another state pension catastrophe that will, once again, predominately affect women.

A few years ago, the government decided to claw back child benefit from higher income earners, where at least one party was paid more than £50,000. Forget issues about the total unfairness of this rule, that’s a whole different article. One household could earn up to £99,999, split equally between both partners and still receive child benefit, whereas another earning £50,001, in which one party doesn’t work, could lose the top-up. It raised the question, however, about whether a household that may no longer be entitled to the benefit should give it up or face a tax charge.

For many, the prospect of completing a self-assessment return, when their taxes are always paid in full through PAYE was a daunting one, along with an unwelcome cost and complexity. For that reason, they gave up the child benefit altogether.

But here in lies the issue. By surrendering child benefit, these people also unwittingly gave up the full national insurance credit that comes with it. As state pension is based on your national insurance record, there are now unknown numbers of parents eroding their future entitlement.

Don’t get stung like the WASPI women

My call to action is this: Engage with your state pension and indeed, all of your pension provision, before it’s too late.

If you think you might be affected by the child benefit issue, or know someone that could be, we can help. We’ve enabled parents and grandparents who care for children to boost their state pension entitlement. The process is relatively straightforward for those of us in the know, so what are you waiting for?

Act now and request your pension forecast from the government’s web portal. If you’d prefer, we can do it for you, simply contact me on (01246) 298181 or email: