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Rakhi Vasavada
Rakhi Vasavada, Financial Advisor
Category: Finance
Satisfied Customers: 4545
Experience:  Attorney and Financial Expert. Have specialization in Financial Laws.Practice experience of over 13 years
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I will be eligible for pension top-up (. 7/6/50) when it comes

Resolved Question:

I will be eligible for pension top-up (b. 7/6/50) when it comes in next year.
Seems like a 6% annuity to me, presumably index-linked, but taxable. Is that a good price?
Submitted: 2 years ago.
Category: Finance
Expert:  Rakhi Vasavada replied 2 years ago.
Dear Friend,

Hello and welcome. Thank you for providing an opportunity to assist you.

In my opinion, you should go for pension top-up.

As you are aware, this scheme is available from October 2015 for existing pensioners and those who reach state pension age before 6 April 2016 - women now aged 61 or over, and men aged 63 or over. Savers can gain the extra pension by paying 'Class 3A' voluntary national insurance contributions. The maximum amount that contributions can provide will be £25 per week. The scheme will only be available for 18 months from October 2015.

Coming to core of your question, I believe it is a better deal than going in for annuity if you have extra liquidity. The price of buying these extra state pension rights has been set at about half the cost of buying an inflation-linked joint life annuity in the open market.

I am sure this would help.

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Warm Regards
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