Going to be claiming Housing Benefit when I retire- worth having employers pension?

atush

AT NO point did I or many others here insult or belittle the OP.

We answered the question honestly. Factually.

Pollycat

atush wrote: »

AT NO point did I or many others here insult or belittle the OP.

We answered the question honestly. Factually.

It appears that lots of people who post on here believe that they are being bullied or abused simply because someone expresses an opinion that differs from theirs.

As someone posted on another thread:

Unfortunately there are also too many people who cry bully when no such thing has taken place then when bullying really does happen it's not taken seriously.

and

I do wish people wouldn't equate disagreeing with someone with bullying them - that just betrays the victims of genuine bullying.

Comstock

HardCoreProgrammer wrote: »

I tend to believe OP that he/she is just trying to make the best of the current situation, and feel sad that the request for advice led to all this.

Yes, thanks for this If I could turn back the clock to my mid 20s, I would have made getting on the property ladder a priority. But that is an awful lot of water under the bridge ago.

Now surely an important part of moving forwards is accepting you can't change the past, and being realistic about your current situation. The simple fact is, short of a lottery win or similar I'm not going to own my own home, which means renting in retirement and that means Housing Benefit. That means understanding the affect of a small private pension on HB and I'm sure I'm not alone in this situation.

I should just say, though, in response to Pollycat's post above, I don't consider any of the responses to this thread to be 'bullying'. Yes, some of the more judgmental ones have saddened me, but bullying is something else entirely.

I still haven't decided what to do, and I've got until 19 July to decide....

atush

Comstock,

I agree that you may rent in your working years if you cannot increase your income. Or change choices you made (or were forced into) when you were younger. But do register on any council lists or whatever to have your own place eventually. At least register once you are in retirement age. But as I said before, if you willfully throw away free money from your employer and tax relief, i do feel in future you could fall foul of deprivation of assets type rules if you opt out of employers pensions.

If you currently have a home and money in the bank and give it away to children or others, then need to be in a care home or get other types of care, you are penalised for having given your money way.

But there are smaller changes you can make. such as going to the CAB- have you? To see if there are any benefits you are entitled to not taken? Or better yet, any training (not talking uni but skills based) opportunities that might be free to you that could up your skills level so as to get a step up in pay in your current job area?

Any chance of exploring these issues over the long term?

Any chance of having a partner in life? 2 living in one property, combining resources can mean a huge uplift in saving potential? If long term partners (and if if a decade or even half can still mean being able to pool resources and save more?) it can be a great way for happiness, heath and savings.

jamesd

Comstock wrote: »

Yes, thanks for this If I could turn back the clock to my mid 20s, I would have made getting on the property ladder a priority. But that is an awful lot of water under the bridge ago.

Plenty of things we'd all change about those years if we had the chance!

Comstock wrote: »

short of a lottery win or similar I'm not going to own my own home

I do think you can, with the help of the pension and investment growth, though it would be nice to put in more and nicer if your employer pays in more than the minimum. If you go for it all that happens int he worst case is that you build up some savings.

I'm also wondering how close you are to getting working tax credits? One thing that pension contributions do is reduce the level of earnings that count towards that, so they make getting it more likely or increase the amount received. When it works out it can be a nice bit of extra help to get the saving and living today working together more smoothly.

Comstock wrote: »

Yes, some of the more judgmental ones have saddened me, but bullying is something else entirely.

Agreed on both, you're simply a person asking for help and that's fine whether it's about benefits, saving or both.

Comstock wrote: »

I still haven't decided what to do, and I've got until 19 July to decide....

You can also ask to opt in at any future date and they will also have auto-enrol you again every two years. They aren't allowed to just accept an instruction not to do it, they really are required by law to repeat this every two years.

missbiggles1

HardCoreProgrammer wrote: »

People do not set out to be intentionally poor. It is a very bad thing to say this.

Assuming OP starts retraining now by studying a degree full time (and not everybody can afford to do that, takes even longer if part time), he/she will be at least 45 when finished. Now how many employers will give a chance to somebody starting out in a new career at this age? I have >20 years in my career, and I am worried that nobody would employ me if I get the P45 post 45!

Some of my relatives finished school and started work in factories, lost their jobs as they closed in the 80s, and ended up on the breadline at old age. My mother entered the civil service when she finished school, and ended up comfortable post retirement as she has a final-salary pension. She did not know the value of the pension benefits when she joined, and there was nobody who told her that it will make a big difference in her retirement. She simply made a random choice and got lucky.

It is quite possible that OP made a wrong decision and ended up on the treadmill unable to change their life. Hindsight is a wonderful thing, and some may not have the benefit of luck or advice. It is very easy to criticise from a position of comfort, but while it puts you on the moral high ground, it does not help the person asking for advice.

I tend to believe OP that he/she is just trying to make the best of the current situation, and feel sad that the request for advice led to all this. It is really unfortunate that Martin Lewis has allowed this kind of abuse to go unchecked and unchallenged on this forum.

There are plenty of ways of (re)training that don't involve taking a degree!

coster

Hi Comstock

As someone who has retired, renting privately, with a modest occupational pension, I can give you some guidance regarding the difference that an occupational pension has on benefits. (Figures rounded to the nearest pound).

I get a state pension of £144.80 plus an occupational pension of £125 a week Nett)). I pay £15 a week council tax and rent of about £98 per week . I do not get any CTB but do qualify for £14 a week HB.

If I did not have the occupational pension I would get £80 a week HB (local housing rate is only £80) and £15 a week CTB. I would also get Pension Credit of £10.80 (all according to the online benefit calculator.

I estimate that I am about £33.80 a week better off for having the Occupational Pension but bear in mind that I have to pay for dental costs and hospital fares, which would otherwise be free.

But this is not the whole story. When I was working I only accrued 10 years pension. But then my employer wanted people to take early retirement and offered a very generous incentive of double pension years. So I took early retirement and got credited with 20 years when I had only paid in for 10.

When I reached state pension age I was able to live off my occupational pension for a few years whilst I deferred taking my state pension. During this time I received full HB and CTB as the deferred pension was disregarded for those means tested benefits. I finally started to take the retirement pension and was handed a lump sum of 25 grand for the years of deferral. I am still allowed £14 a week HB even though my savings are well in excess of the usual £16000 limit as the lump sum is disregarded for purposes of HB.

Of course this was all in the past and many things may have now changed but my point is that you cannot predict the future. I would never have predicted that my employer would give me double pension years or that I would be able to defer my state pension and still get HB and CTB and eventually a very tidy lump sum. Joining the company pension scheme was the best thing that happened to me.

There are other advantages too. When you are looking to rent in the private sector you have better prospects if you are not entirely reliant on HB. I know you say there are some retirement homes near you where HB would not matter but things could change. Also if you get a part time job the pension will help to keep your head above water.

There are too many variables for you to make any reasonable prediction about what might happen over the next 25 years.

I strongly advise you to join the company pension scheme. It is not so much a pension it is more like a "wage" that they continue to pay you for the rest of your natural life Trust me, it feels good to know that you have an earned income. It is a constant reminder of how you were once a useful and productive member of society.

Best of luck whatever you choose.

Comstock

OK thanks everyone.

One last question. Have I understood this correctly- the money I save, I can get 25% at any point after 55, as a one time only deal, and the rest goes to buy an annuity when I retire which pays a fixed percentage per year for the rest of my life. So I couldn't, for example, buy a house (if my fund was big enough, which I doubt) with the whole lot?

Have I understood that correctly?

bigfreddiel

Comstock wrote: »

OK thanks everyone.

One last question. Have I understood this correctly- the money I save, I can get 25% at any point after 55, as a one time only deal, and the rest goes to buy an annuity when I retire which pays a fixed percentage per year for the rest of my life. So I couldn't, for example, buy a house (if my fund was big enough, which I doubt) with the whole lot?

Have I understood that correctly?

If you had enough in your fund you could buy a house.

Or you could buy a car.

In fact you can buy anything you like, as long as you have enough

Good luck fj

HappyMJ

Comstock wrote: »

OK thanks everyone.

One last question. Have I understood this correctly- the money I save, I can get 25% at any point after 55, as a one time only deal, and the rest goes to buy an annuity when I retire which pays a fixed percentage per year for the rest of my life. So I couldn't, for example, buy a house (if my fund was big enough, which I doubt) with the whole lot?

Have I understood that correctly?

if you bought a house you wouldn't get housing benefit....

You could buy a new car.

You do not need to buy an annuity you could opt for flexible drawdown which protects your capital at the risk of running out at some point.