What to do with lump sum

busted_flush

Hi, I've recently begun to think about what I should be doing in a few years once I'm able to access my lump sum... so first off a bit of background.

Male, 50 y.o. stopped working 3 years ago due to health problems (unlikely to return to work as condition is degenerative), in receipt of PIP, ESA (CB), Housing Benefit. My private pension currently stands at around 50K and I've another tiny one of 1K that I didn't know I even had til they found me after 30 years.

So what to do with my pension, do I leave it alone until 67? (as there seems no point in taking a monthly amount as will only affect my benefits), Am I allowed to start taking bits of my lump sum from 55 onwards to do things with while I still can? Or is that frowned upon by DWP and local authorities? Would they class that as notional income even if the bits of my lump are taken 2 or 3 years apart? (won't be big amounts anyhow, maybe 3 or 4K in any given year with a few years in between taking them). So If this is the case and I'm allowed to do this then are there any knock on effects? Does my pot continue to grow? Does my lump continue to grow but adjusted for any amounts taken? Would my local authority add these up even though they are a few years apart and start to reduce my housing benefit? Might there be tax implications if an amount I take is added to my ESA in that tax year? I've spoken to a couple of IFA's but there knowledge of the benefits system was quite limited, so any advice would be gratefully received.

dmelife

Think you would be ok having up to £6k capital before your benefits are affected. Between £6k and £16k they would be reduced.
Your pension pot (what’s left in it) will not be taken into account until you reach state pension age.

xylophone

https://www.sheffield.ac.uk/polopoly_fs/1.531608!/file/pension_flexibilities_dwp_benefits.pdf

busted_flush

Many thanks for that info.

busted_flush

dmelife wrote: »

Think you would be ok having up to £6k capital before your benefits are affected. Between £6k and £16k they would be reduced.
Your pension pot (what’s left in it) will not be taken into account until you reach state pension age.

Hi, thanks for that info, ill keep on digging, cos although its a little way off yet its not the kind of thing you want to get wrong, I dont want to take a bit here then a couple of years later a bit there only to discover a few years later I was in the wrong and get into bother.