Add to `pot' or not possible.

skintmostofthetime

Hi, hope I make sense....... having inherited cash I have paid off all mortgages etc and now have about £50,000 left. I have several small pensions amounting to a similar amount but they will not pay enough to enable me to take early retirement yet. Can I add my savings to these thus enabling me to do so? I am not due to retire for another 9 years 2 months aged 66 and can exist on the annuity I could get from £100,000 ( I think ! ) until my gov pension kicks in. Thanks for any opinions and advice

thenudeone

You can get tax relief on pension contributions up to 100% of your income, (max £50k).

Even if you have no (or very low) income the government will still give you tax relief on gross contributions of up to £3600 (£2880 net), even if you haven't paid any tax.

Whether or not it's the best option for you is a different matter.

The main benefit of pensions over other forms of provision is the tax relief. Without it, the downsides (no early access, limited means to withdraw the funds, can't pass on through inheritance, and others) outweigh the advantages IMO, unless there is something unusual in your circumstances.

So the best answer probably depends on your income now and expected income in retirement.

skintmostofthetime

Thanks but my intention was to stop work now and use this `pot' to exist until my full pension kicked in. Need to look at it more me thinks.!

Lokolo

You don't need a pension to do that.

There are so many options its a bit difficult to tell you what you want. Questions such as, do you want to eat into your capital? Do you want inflation protection? Do you want to risk your capital? What sort of income range are you looking for?

skintmostofthetime

Yeah, haven't given you much to work with but was confused. So.........I'm a female who can't OFFICIALLY retire for another 9 years but was hoping to use `pot' and savings to do so until Gov pension kicks in. Need approx £20,000 income if Husband can't go back to work , less if he does. (Unsure how this stands as he's just had major surgery on spine. Even if he does, unsure what he can do as can't return to old job due to various ops over last 2 years - new knee, new hip now spine. Building trade - no good !) So ...... presuming the worse, need £20,000 which I was thinking was roughly what I could get on £100,000 pot - if lucky, If needed I wouldn't object to working a bit but as have worked consistently since aged 16 - 40 years, I would like to take it easy now - husbands health probs have made me think seriously about this as he was really REALLY fit until hit 60 then all went wrong and if that does happen to me I'd like to think I've done a bit more than just work 40/50 hours a week for it all to go up the wall.! Sorry - off track, but I think this may make everything else make sense. So given that I have the cash - any ideas of options? Is it illegal to add savings or am I really looking at just having everything in separate places when I was thinking I would be better to just lump it all together somewhere? It will leave me with no emergency funds but as I've said - I have no objection to working part time - just not 5 days a week and was hoping this would be voluntary and not compulsary. Basically I want to use what I've got as an income pending Gov pension time. so........... opinions/ideas please. Cheers.

grey_gym_sock

if you want £20k income now, how much will you want in 9 years' time? because presumably the state pension alone won't be enough. when will your husband get a state pension, and does he have any other pensions, too?