Deferred State Pension Interest Rate

Anne1953

Currently deferred state pension lump sums attract a guaranteed interest of 2% above Bank of England base rate, with this tumbling at a great rate, is it wise to sit tight at present or look for another fixed rate interest paying savings account in case the current rate disappears? 

Marcon

Depends if you can find something better. Start here: https://www.moneysavingexpert.com/banking/?_ga=2.158637498.1816507810.1584632588-353475065.1523260899

jamesd

Also be aware that lump sums are only available for those who reached their state pension age before 6 April 2016.

From then on a lump sum is only paid for deferral of less than a year and only by delaying claiming, not by starting deferring the one time allowed after claiming.

I think you may already know this, so just making sure.

Anne1953

Yes thanks I do fall in to the before 6 April 2016 category.

garmeg

Anne1953 said:

Currently deferred state pension lump sums attract a guaranteed interest of 2% above Bank of England base rate, with this tumbling at a great rate, is it wise to sit tight at present or look for another fixed rate interest paying savings account in case the current rate disappears? 

Anne1953 said:

Yes thanks I do fall in to the before 6 April 2016 category.

In that case the (old) state pension increases at 10.4% pa (simple interest) when deferred, plus the usual inflationary increases as well.

Base rate does not come into the equation. 

t0rt0ise

garmeg said:

Anne1953 said:

Currently deferred state pension lump sums attract a guaranteed interest of 2% above Bank of England base rate, with this tumbling at a great rate, is it wise to sit tight at present or look for another fixed rate interest paying savings account in case the current rate disappears? 

Anne1953 said:

Yes thanks I do fall in to the before 6 April 2016 category.

In that case the (old) state pension increases at 10.4% pa (simple interest) when deferred, plus the usual inflationary increases as well.

Base rate does not come into the equation. 

The OP is talking about the lump sum option, not the weekly addition option.

garmeg

t0rt0ise said:

garmeg said:

Anne1953 said:

Currently deferred state pension lump sums attract a guaranteed interest of 2% above Bank of England base rate, with this tumbling at a great rate, is it wise to sit tight at present or look for another fixed rate interest paying savings account in case the current rate disappears? 

Anne1953 said:

Yes thanks I do fall in to the before 6 April 2016 category.

In that case the (old) state pension increases at 10.4% pa (simple interest) when deferred, plus the usual inflationary increases as well.

Base rate does not come into the equation. 

The OP is talking about the lump sum option, not the weekly addition option.

I wasnt aware of that option. Seems a poorer deal than a higher pension.