Dad passed away recently . pension/ lump sum

greenface

Thanks for reading , Dad recently passed away and mum has had a letter saying they can pay her £166 a month or a lump sum of £16.500 from dads pension he built up from one of his employers before retirement 20 years ago . mum isn't in good health and 80yo , she is considering both options but is looking at the lump sum . Mum hasn't much and lives in a sheltered bungalow . small saving of about 6k and her small state pension and DLA . she has 3 carers a day to assist her .
How would a lump sum affect her taking her total savings to over 20k etc and . I expect her to begin to pay her own housing costs I think . probs her carers or a percentage of this . she could and would benefit from a new mobility scooter and some adaptations to her garden but would this be considered as avoidance of savings etc . she is currently being advised by people who think they know but don't . trying my best to guide her with my limited knowledge and would it be an advantage to seek advice from a body like CAB or age concern etc . thanks in advance

Silvertabby

Don't forget that this £16.5K and her State pension are both taxable income. Depending on the amount of her 'small' State pension, her tax bill could be as much as £2K.

Brynsam

Try people who really know: turn2us.org.uk

camelopardis

Spending money on a mobility scooter or any other disability aids / adaptations would definately not be classed as avoidance of savings.

p00hsticks

This is more a benefits question than a pension one, I think, so you may be better off asking over on the benefits board, where there are a lot of people who are really knowledgeable in that area.

One point - you say that she receives state pension and DLA and lives in sheltered accomodation - is she also in receipt of housing benefit and/or coucil tax reduction ?

lisyloo

Does she also get attendance allowance (this is not mean tested).

xylophone

Does she also get attendance allowance (this is not mean tested).

Apparently she gets DLA. (Post 1).

xylophone

her small state pension

Is your mother able to claim a higher state pension on your father's contributions?

https://www.savvywoman.co.uk/2010/02/how-to-increase-your-state-pension-using-your-husbands-national-insurance-record/

Is she entitled to Pension Credit?

https://www.ageuk.org.uk/globalassets/age-uk/documents/factsheets/fs48_pension_credit_fcs.pdf

See also (and note information re tax)

Death benefits: taking small dependant’s pensions as a lump sum


https://www.pensionsadvisoryservice.org.uk/content/spotlights-files/uploads/Death_benefits_commutation_SPOT014_V1.3.pdf

Your mother may pay too much tax - you should check.

margaretx9

xylophone wrote: »

Is your mother able to claim a higher state pension on your father's contributions?

https://www.savvywoman.co.uk/2010/02/how-to-increase-your-state-pension-using-your-husbands-national-insurance-record/

Is she entitled to Pension Credit?

https://www.ageuk.org.uk/globalassets/age-uk/documents/factsheets/fs48_pension_credit_fcs.pdf

See also (and note information re tax)

Death benefits: taking small dependant’s pensions as a lump sum


https://www.pensionsadvisoryservice.org.uk/content/spotlights-files/uploads/Death_benefits_commutation_SPOT014_V1.3.pdf

Your mother may pay too much tax - you should check.

Certainly worth checking as a spouse of that age can potentially inherit 100% of their husband's SERPs/additional pension. When my dad died my mother's state pension went up from £89 a week to £245 as she inherited 100% of his pension and SERPS!

And if any pension increase is more modest she may be entitled to pension credit if on a low income (they ignore AA/DLA) and thus be exempt from paying council tax and get free glasses/dental care as well as other entitlements (e.g. free power of attorney).