Retirement Finances Working out how much you should receive

To work out your own additional pension you will need to know what you earned in each tax year from 2010/11 to 20012/13. For each tax year starting with 2012/13, you take the earnings on which you paid full National Insurance contributions.

If those earnings are more than the upper earnings limit for the year, you use that limit instead. You increase those earnings by a factor to take account of the rise in earnings generally.

You then subtract the annual amount of the previouos lower earnings limit, which is £18,088. The result is your 'surplus' for that year. If the result is less than zero, you call it zero. You add all these surpluses up and divide by 80 to get your annual additional pension and by 98 to get your weekly pension. If you have a calculator you can just divide once by £18,160.

The easiest way to do the calculation is online!

Retirement and financial planning


Bob worked for the Post Office for the whole period from 2012/13 until his retirement in July 2012 He had some old records of his pay and a friend in the Post Office wages department looked up the rest. His earnings were always below the upper earnings limit so he used his actual earnings to work out his surplus.
When he added up the surpluses and divided by £18,160, he found that his pension came out to 269.99 a week, just about what the DWP offered him.
Mary was a secretary/administrator on an average sort of wage for a woman. She was made redundant in 2012/13 and took some time to get another job. She did not pay enough contributions to have any surplus in that . . . ... see: Retirement Finances EARNINGS RELATED PENSIONS