Pension/Lump sum/JSA

gorjam

Hi
I have 2 Questions really, I'm hoping someone can be of assistance. I am being made redundant on the 31st Jan, after over 35years in the LGPS, the questions are:-
1, My pension will be about 11400pa, with a lump sum of 27000 does it make financial sense to take more of a lump sum and less annual pension( I will be unemployed looking for work in an unemployment blackspot)?
2, Even though I have a pension does it make sense to claim income based JSA even though I know I won't get it?
I am 55 years old and my wife earns less than £10000pa.
Thanks again in anticipation and I know I probably haven't worded this the best way possible.
Thanks

IainHL

gorjam wrote: »

1, My pension will be about 11400pa, with a lump sum of 27000 does it make financial sense to take more of a lump sum and less annual pension( I will be unemployed looking for work in an unemployment blackspot)?

The lump sum you are talking about here is presumably the tax free lump sum you are entitled to take from your pension pot? Is there no other lump sum amount for actually being made redundant? As I have seen suggested elsewhere on the forums, maximise the amount you get tax free (which could be up to £30k redundancy and 25% of your pension), since there isn't much in life that comes tax free!

If you have the option of taking a larger tax free lump sum out of your pension pot, for a corresponding decrease in the pension payable, then that really comes down to your personal circumstances and what you intend to do with the lump sums. For instance you might pay off your mortgage, or loans, and therefore reduce your monthly outgoings.

gorjam wrote: »

2, Even though I have a pension does it make sense to claim income based JSA even though I know I won't get it?

If you feel you can satisfy the demands of DWP/JCP then claim JSA. At least you will then get NI contributions credited to you.

gorjam

Thanks for the informative answer IainHL and yes you are correct the £27000 is my pension lump sum, I also am being paid a lump sum redundancy payment.
My worry is that from April I can earn £10000 before paying any tax, therefore thought it best to leave my pension income at around that level, maybe £9999 so if I don't find work I can claim to be a non-taxpayer, and claim gross interest on any savings.
I'm thinking maybe this is in the wrong thread and should be in the pension thread.
Thanks

getmore4less

You can't do that if the savings income would make you a tax payer you still pay the tax.

Check your state pension situation for NI credits.

Check the conversion rate for pension to lump sum the pension may be better especially if index linked.