not enough to live on

xylophone

State pension credit isn't going to be an option until my savings are considerably depleted down to £10,000

This is too simplistic. See p 16 of Age Concern and "deemed income" - GPC is an income related benefit - the question to ask is how much income your capital over £10,000 is deemed to produce.

It is obvious that the "deemed" rate is ridiculously high but presumably your capital is reducing quite substantially each year if state pension and some savings interest is your only income?

Carolinemjs

Not sure I'm understanding but given that my savings are £40,000 in excess of £10,000 that is ignored, and every £500 represents £1 of income, that equates to £80 a week doesn't it?

xylophone

Not sure I'm understanding but given that my savings are £40,000 in excess of £10,000 that is ignored, and every £500 represents £1 of income, that equates to £80 a week doesn't it?

But presumably your savings are rapidly diminishing?

mollycat

Mojisola wrote: »

As you're only 66, have you thought about doing a part-time job or short blocks of temping?

Is downsizing a possibility?

If not, would you consider a lodger? Depending where you live, a Mon-Fri lodger could be a possibility - extra income but you have the house to yourself all weekend.

Maybe read the OP?

kidmugsy

Carolinemjs wrote: »

The suggestions here seem to be the best options at the moment:-

3. Check and compare the interest rate charged on equity release vs advantage of deferring state pension

Here's a rough calculation. Assuming that your pension is the old-style one (started before 6/4/16) you will get an extra 10.4% on your pension for each year of deferral. On the other hand, each year of deferral means, obviously, a year without pension. Suppose you will live another 25 years: one year without pension means approx a 4% reduction in total pension income over the next 25 years. 10.4% less 4% equals 6.4%, which is a pretty good annuity-like return, given that it's index-linked (to CPI). Moreover, deferring your state pension would mean that your capital would run down more quickly, but now with a good side-effect i.e. higher state pension eventually.

But beware: from https://www.gov.uk/deferring-state-pension/what-you-get

"3. If you get benefits or tax credits

You can’t build up extra State Pension during any period you get:

Income Support
Pension Credit
Employment and Support Allowance (income-related)
Jobseeker’s Allowance (income-based)
Universal Credit
Carer’s Allowance
Incapacity Benefit
Severe Disablement Allowance
Widow’s Pension
Widowed Parent’s Allowance
Unemployability Supplement

...

Taking your extra State Pension as higher weekly payments could reduce the amount you get from:

Income Support
Pension Credit
Universal Credit
Employment and Support Allowance (income-related)
Jobseeker’s Allowance (income-related)
Housing Benefit
Council Tax Reduction
tax credits"


P.S. There might be an advantage to fixing up an equity release in the present period of ultra-low interest rates. There are variants available where you draw down the loan in bits, when you need the money. That way interest is charged only on the money you've drawn, not on the total size of the agreed loan. If the period of ultra-low interest rates persists then you may gain by waiting a while.

Silvertabby

Not sure I'm understanding but given that my savings are £40,000 in excess of £10,000 that is ignored, and every £500 represents £1 of income, that equates to £80 a week doesn't it?

DWP 'assume' that your income is your £125.67 State pension plus (your figures) £80 per week, which takes you over the limit for claiming means tested benefits. As xylophone says, the assumption is ridiculously high.

Carolinemjs

xylophone wrote: »

But presumably your savings are rapidly diminishing?

Not that rapidly 😊
I reckon I can make it last 5 years plus

Mojisola

mollycat wrote: »

Maybe read the OP?

I did - the OP added all that information after I made my suggestions.

mollycat

Mojisola wrote: »

I did - the OP added all that information after I made my suggestions.

OOPS.....apologies!:o

xylophone

Not that rapidly ��
I reckon I can make it last 5 years plus

Then it might well be worth your while to defer your state pension and live on savings for a certain period.

This is for NI but the principles are the same.

https://www.communities-ni.gov.uk/sites/default/files/publications/dsd/your-guide-to-state-pension-deferral.pdf