Originally Posted by tdrinker

The online record should tell you how many more years you need to contribute for as full pension, taking account of contracting out. Otherwise HMRC should tell you, but they are saying you need more years but not how many. Why they can't simply look up you record and clarify is unknown.

Originally Posted by freerskier

But as you say if it is just 2 years (I think with my 1990 - 96 contracted out period its more likely around 4 but only the unreachable FPS can give me an exact quote) GBP1600 or around US$2200 at, say, 5% in an ETF for 10 yrs is US$3500/GBP2600 or so = minus tax 'o course. I guess Id have to pitch this against what the state pension being index linked could go up by. Its a bit of a conundrum on how it all could work out.

Originally Posted by freerskier

Well its been a couple of months or 3 and I got the letter back from HMRC with the table showing 8 years and what the Class 3 amounts that I could owe. - there lies the rub. More later.

It does state that I have 33 years and am 2 years shy of the full 35. I've called HMRC twice and got through really easily but both times they said they cannot say what I should pay and to contact the Future Pensions Service to get the exact amount. I questioned that surely with 33 years I have 2 years. It was only on the second call that, similar to some of your experiences, the helpful HMRC associate advised that it could be more as I was in an employer contracted out scheme from 1990 to1996. I need to call FPS for the exact amount - calling FPS is another story: Ive never got through. In this 2nd call the associate advised that at the moment I would get now would be GBP145 per week with the current full pension being GBP179.60 AND each additional "back" year I pay adds GBP5 per week to my pension.

So my maths/investing dilemma has come down to ones described here and in other threads. At Class 3 I would be paying GBP795 (but see below as some years I owe are less) for each year to add GBP5 per week or GBP260 per year to my pension. So to get GBP795 BACK in would take around 3 years - well a little more when you factor that pensions payments would be taxed.

The associate, in his experience, reckoned I could pay now the 3 'cheaper' years quoted in the table to gain GBP15 per week making the pension around GBP160 p/w. The 3 cheaper years on the table are GBP504.60 + 761.80 + 780 = GBP2046.40. He thought I did owe at least the 3 years but it could be more - contact the FPS etc etc etc. Put in 'investment' terms a GBP2046 investment returns me GBP260 per year and that 2046 is "paid back" in around 7.8 years - not including tax or around a 12% "return" per yer on the "investment" - so, on the face of it that sounds OK, eh?

1) I'll probably retire in 8 - 10 years at age 65 to 67
2) As I cant get through to FPS has anyone had a valid stab at calculating how may additional years you have to repay per year you were in a contracted out scheme as one idea - if its worth it - is to deliberately slightly overpay.
3) To pay the rates quoted in their letter I need to do all this by next Friday! ..Or the amounts per year go up to around GBP800 per year

As a side note I intended to pay any back years by DD so completed this section on the CF83 form. The associate said you can only pay future years by DD not years from the past you are repaying.

Look, I know this is long and winding and that, on review, there's a fair amount of me working my situation out in the post - I could have made it a lot shorter by quoting a few figures and just saying "Hey guys, whadyareckon!". So, again any help and insight as I'm in the weeds etc appreciated as I am beginning to loose feeling in my fingers tapping the numbers into my calculator.