Pension contributions vs pension payouts (U.K. and japan)

[KCLenny]

Hi all, so as some of you may know I’ve been trying to sort out my U.K. pension contributions. And I’ve also been exempted from paying my Japanese pension for 2 years so far. My most recent interaction with my ward office ended with a 50% exemption due to my income.

So I have a question that can be subdivided into 2 questions.

1. In japan, I believe you have to make 40 years of pension contributions. Is that in order to get full pension or just to claim at all? In the case of exemption, full or partial, how much is that going to affect the pension received in the future? So, just for example, if someone was 100% exempted for their entire life, how much pension would they receive at retirement age if any? (I’m not asking this because I don’t plan on ever paying, I’m just curious what the minimum amount is you can expect to get)

2. The same question but for the U.K. I believe you have to make 30 or 35 years of contributions in the U.K. minimum 10 to claim anything.
So for example, if you only make 10 years of contributions, how much can someone expect to receive when they retire?

I am positive I can pay for my U.K. pension for the total amount of time, Japanese pension less sure. But my wife (English), has no contributions in the U.K. at all, and has so far been exempted in japan for 2-3 years. Very unlikely she’ll ever be working to the point of being able to pay. And I’m not sure if I’ll ever earn enough to fully pay pension here either (both of us have autism and mental health issues (and more recently looking into a chronic fatigue diagnosis)). How’s it looking for us? (I’m 30, wife is 26). And I really don’t want people telling me to go back to the U.K., or just work more or suck it up etc.
Thanks in advance.

[Beaglehound]

On question one, you have to pay in for a minimum of ten years to get anything at all. As regards exempted or partially exempted payments there is a sliding scale, so for example you are currently paying half the full amount, which will net you two thirds of the payout.So a good deal. This document has info in English about the J pension, and is probably an easier read (in terms of language) than many government documents.

For your wife, for each year she is fully exempted she will get half of the payout.

https://www.nenkin.go.jp/international/ ... nsion.html

On question 2, at current rates, 10 years of U.K. contributions would get you roughly £2650 a year.

How to address your situation overall is more tricky. No time now but will chime in later if nobody says what I would say.

[RetireJapan]

Hi all, so as some of you may know I’ve been trying to sort out my U.K. pension contributions. And I’ve also been exempted from paying my Japanese pension for 2 years so far. My most recent interaction with my ward office ended with a 50% exemption due to my income.

So I have a question that can be subdivided into 2 questions.

1. In japan, I believe you have to make 40 years of pension contributions. Is that in order to get full pension or just to claim at all? In the case of exemption, full or partial, how much is that going to affect the pension received in the future? So, just for example, if someone was 100% exempted for their entire life, how much pension would they receive at retirement age if any? (I’m not asking this because I don’t plan on ever paying, I’m just curious what the minimum amount is you can expect to get)

2. The same question but for the U.K. I believe you have to make 30 or 35 years of contributions in the U.K. minimum 10 to claim anything.
So for example, if you only make 10 years of contributions, how much can someone expect to receive when they retire?

I am positive I can pay for my U.K. pension for the total amount of time, Japanese pension less sure. But my wife (English), has no contributions in the U.K. at all, and has so far been exempted in japan for 2-3 years. Very unlikely she’ll ever be working to the point of being able to pay. And I’m not sure if I’ll ever earn enough to fully pay pension here either (both of us have autism and mental health issues (and more recently looking into a chronic fatigue diagnosis)). How’s it looking for us? (I’m 30, wife is 26). And I really don’t want people telling me to go back to the U.K., or just work more or suck it up etc.
Thanks in advance.

480 months of payment to kokumin nenkin currently would give you a pension of around 65,000 yen a month. If you pay in fewer months, the pension would be reduced proportionally (240 months = about 37,500 yen a month). If you are exempt from paying, you get a reduced pension eligibility (fully exempt is half the pension, 3/4 exempt you get 5/8ths of the pension, 1/2 exempt you get 6/8ths, 1/4 exempt you get 7/8ths of the pension): https://www.nenkin.go.jp/service/kokune ... tml#cms001

In the UK you need to pay in for 35 years to get a full pension. This is currently just under 180 pounds a week. If you pay fewer years the pension is reduced proportionally: https://www.gov.uk/new-state-pension

I would definitely try to get both of you paying into the UK state pension voluntarily. It is currently a very good deal.

[Beaglehound]

I am positive I can pay for my U.K. pension for the total amount of time, Japanese pension less sure. But my wife (English), has no contributions in the U.K. at all, and has so far been exempted in japan for 2-3 years. Very unlikely she’ll ever be working to the point of being able to pay. And I’m not sure if I’ll ever earn enough to fully pay pension here either (both of us have autism and mental health issues (and more recently looking into a chronic fatigue diagnosis)). How’s it looking for us? (I’m 30, wife is 26). And I really don’t want people telling me to go back to the U.K., or just work more or suck it up etc.
Thanks in advance.

Your age is a positive, you are thinking about retirement and planning for it, and you have plenty of time. The flip side of that is that you will not be retiring (in the sense of collecting state pensions) for at least 35 years, longer for your wife, and perhaps longer for both of you if pension ages are raised. So if I were you I would not be putting all my available resources into state pensions. Nobody knows what their status will be. Better to try to establish some state pension entitlement and also save independently, which I know you are already doing through NISA. Any cash invested in that has ample time to grow.

For Japanese kokumin nenkin, even with exemptions you will build up some entitlement, although the payouts are not generous. U.K. is a better deal as Ben said, especially if you can pay class 2s. Your wife should be eligible to pay class 3s on my understanding of the current rules, and it would probably be worth it to do that.

One more thought. You have many years of working life ahead of you, and if you worked for a company that provided shakai hoken (social insurance) it would make your situation more secure. I am not telling you to work more, or harder; from what you said about your current working hours in a previous thread, you already are basically full time, but I would be trying for positions in future that offer shakai hoken. Plenty of schools do. If you have it, the company match your pension contributions, meaning you will get a better pension, and your wife’s kokumin nenkin payments would be covered too, meaning she would get the full payout. The company would also match your health insurance contribution and your wife would be covered too. In the long run, being on shakai hoken would make a difference to your current finances (less to pay in health insurance premiums) and future prospects (better Japanese pensions for both of you).

[bryanc]

this is very interesting..
can someone point me in the direction for info on the below:

1.website for calculating japanese pension will get

2.voluntary uk pension contributions (i remember reading this on here before)
thanks

[KCLenny]

this is very interesting..
can someone point me in the direction for info on the below:

1.website for calculating japanese pension will get

2.voluntary uk pension contributions (i remember reading this on here before)
thanks

Not sure about the Japanese pension, but the voluntary U.K. pension application can be found here
https://assets.publishing.service.gov.u ... _12_20.pdf

Your age is a positive, you are thinking about retirement and planning for it, and you have plenty of time. The flip side of that is that you will not be retiring (in the sense of collecting state pensions) for at least 35 years, longer for your wife, and perhaps longer for both of you if pension ages are raised. So if I were you I would not be putting all my available resources into state pensions. Nobody knows what their status will be. Better to try to establish some state pension entitlement and also save independently, which I know you are already doing through NISA. Any cash invested in that has ample time to grow.

For Japanese kokumin nenkin, even with exemptions you will build up some entitlement, although the payouts are not generous. U.K. is a better deal as Ben said, especially if you can pay class 2s. Your wife should be eligible to pay class 3s on my understanding of the current rules, and it would probably be worth it to do that.

One more thought. You have many years of working life ahead of you, and if you worked for a company that provided shakai hoken (social insurance) it would make your situation more secure. I am not telling you to work more, or harder; from what you said about your current working hours in a previous thread, you already are basically full time, but I would be trying for positions in future that offer shakai hoken. Plenty of schools do. If you have it, the company match your pension contributions, meaning you will get a better pension, and your wife’s kokumin nenkin payments would be covered too, meaning she would get the full payout. The company would also match your health insurance contribution and your wife would be covered too. In the long run, being on shakai hoken would make a difference to your current finances (less to pay in health insurance premiums) and future prospects (better Japanese pensions for both of you).

Thank you. I’m a little unsure about finding new work right now. I’d love to have a job that has similar hours to my current place for the same hours plus the Shakai hoken, I just can’t find anything like that right now and some that I think might be good require moving to places I’ve never been or really don’t want to move to. I keep my eye out on job listings though. Not sure what else I can do (for free) to increase my job hunting prospects for the time being though.

[beanhead]

this is very interesting..
can someone point me in the direction for info on the below:

1.website for calculating japanese pension will get

nenkin net

You set up an account and can then see your projected pension.

[Moneymatters]

this is very interesting..
can someone point me in the direction for info on the below:

1.website for calculating japanese pension will get

There are very precise calcs to deduce your Japan pension based on your contributions and even when they were made (due to changes in the formula). Sadly it requires two animal sacrifices and we’ve exceeded our quota for the year. You also need to predict what you’ll earn in the future so it’s guesswork anyway.

So an approximation method will have to do.

https://nenkin-ikura.com/

It’s not clear but the duration you enter in this section will count just base pension contributions 国民年金.
“非会社員期間(学生・無職・自営)”

It doesn’t allow you to put bonus payments in so roll those in to salary. Obviously if you are fortunate to earn over the max limit you can’t do that.

As most foreigners won’t get to 40 years you’ll need to stick some years in the 未納付期間 section.

If you want to get real smart you could factor in voluntary contributions from 60-65 to replace some of those missing years.

Let us know if you get stuck.

There is a retirewiki article about nenkin net and the online tool for building projections. I may have had a hand in its creation.

https://retirewiki.jp/wiki/Nenkin_Net

Not mentioned, but step one is to pour yourself a large drink.

[bryanc]

wonderful
thanks

[bryanc]

I am positive I can pay for my U.K. pension for the total amount of time, Japanese pension less sure. But my wife (English), has no contributions in the U.K. at all, and has so far been exempted in japan for 2-3 years. Very unlikely she’ll ever be working to the point of being able to pay. And I’m not sure if I’ll ever earn enough to fully pay pension here either (both of us have autism and mental health issues (and more recently looking into a chronic fatigue diagnosis)). How’s it looking for us? (I’m 30, wife is 26). And I really don’t want people telling me to go back to the U.K., or just work more or suck it up etc.
Thanks in advance.

For Japanese kokumin nenkin, even with exemptions you will build up some entitlement, although the payouts are not generous. U.K. is a better deal as Ben said, especially if you can pay class 2s. Your wife should be eligible to pay class 3s on my understanding of the current rules, and it would probably be worth it to do that.

wouldnt his wife also be eligible for class 2 if she worked part time jobs? even for a short time seems to qualify as I understand?

What happens if I earn less than the weekly/monthly threshold?
If you have earnings above the lower earnings limit (£120 per week or £520 per month for 2021/22) and below the primary threshold (£184 per week or £797 per month for 2021/22) you will not have to pay any Class 1 NIC. Your NIC record will be credited, however, as you have paid Class 1 NIC at a zero rate. These may earn you entitlement to contributory benefits and the state pension.

If you earn less than the lower earnings limit (£120 a week for 2021/22), you pay no Class 1 NIC and you do not get any contributions attached to your NIC record.