pension and what to do

LynnCG

good morning

I am a 52 year old woman and my partner is 46. I have a tiny pension from my days with the probation service which was accumulated over a 3 year period and matures when i am 63ish it currently realises a cash sum of around 3K and a pension of around £80 pcm.

neither of us has ever done anything tangible about pensions but we have both now been sent the bumph on work place pensions.

We own / mortgage a small house which will be paid off in 13 years.

My question is in essence is that at my age surely the work place pension is going to have a negative effect on any benefits i may be entitled to.

I say this because i remember my mother starting a small NHS pension at 54 which gave her a monthly income of something silly like £20 this in effect barred her from any other statutory benefits and caused her to be significantly worse off than her peers who had no private pension.

As you can tell i know very little about all of this.

It is our full intention to sell the house and move to rented accommodation once i retire which hopefully will mean my partner who is significantly younger can retire early and we can travel etc.

best advice and opinions please would be very much appreciated

dunstonh

My question is in essence is that at my age surely the work place pension is going to have a negative effect on any benefits i may be entitled to.

What benefits? Pension credit is being abolished in two years time. There will still be a few benefits left but the main one is going to be gone. They will be reserved for those really on the breadline.

I say this because i remember my mother starting a small NHS pension at 54 which gave her a monthly income of something silly like £20 this in effect barred her from any other statutory benefits and caused her to be significantly worse off than her peers who had no private pension.

Which is why the rules were changed.

It is our full intention to sell the house and move to rented accommodation once i retire which hopefully will mean my partner who is significantly younger can retire early and we can travel etc.

Lets say you do nothing. That will give you around £8500 a year income in retirement. Your travel plans will probably be little more than the concessionary bus pass to the local Aldi and back. The sale of the house will remove any potential benefits and the use of the lump sum for pleasure spending may be viewed as deprivation of assets under the means test depending on how quickly you erode it.

At the moment, your plans don't seem to be matched by your financial planning and it looks like you will have a big financial black hole stopping you from doing what you want.

Joining the works pensions at 46/52 is common sense.

atush

My question is in essence is that at my age surely the work place pension is going to have a negative effect on any benefits i may be entitled to.

Planning to live on benefits is insane. And probably will no longer be allowed as said above, the pension credit will be going soon.

Second, selling your house and renting- how will this help you? Do you like the idea of rent rising each and every year? Will you be able to aford it, or will you be kicked out eventually if you can't pay? You wont get a council house of you sell yours, you wil be making yourself intentionally homeless.

Keep your house, or downsize if you can to a one bed flat. Otherwise look at equity release eventually.

Join the WP pension. Asap.

bigadaj

It's yet further evidence of what a. Shocking state we're in.

People's expectations are just to play the system, we should be stripping out these benefits, make people,mreasponsible for their own actions, and also removing the dodgy tax fiddles to make sure the top end actually pay their dues.

xylophone

Regarding your state pension see https://www.gov.uk/government/uploads/system/uploads/attachment_data/file/181237/single-tier-pension-fact-sheet.pdf

Your employers will be contributing to the pension schemes? Why would you turn down the equivalent of a salary increase?

OldBeanz

Presumably because under the last Labour government if your pension was under about £4.5k then you were no better off as the state made up the difference. The present government are trying to reverse this and ensure people save for their retirement.

le_loup

I suspect this post is a spoof - or could it be one of the sort of people who the chancellor believes is capable of making all the right sensible decisions?

Eric_the_half_a_bee

bigadaj wrote: »

It's yet further evidence of what a. Shocking state we're in.

People's expectations are just to play the system

That's a little unfair. You can't blame people for responding to incentives. Many of the discussions on this forum revolve around playing the system to minimise tax for example.

Blame the politicians who create the bad incentives

kidmugsy

Eric_the_half_a_bee wrote: »

Blame the politicians who create the bad incentives

They're only playing to the crowd. It's a democracy, so it's the electorate to blame.