Bridging the gap. What is my income?

Dansmam

I'm living on savings to bridge the gap before DB can sensibly be taken with a lower level of reduction for early payment in just over a year's time. 'Paying ' myself the equivalent of the projected pension meanwhile. Basically any new money is made up of pennies in interest on savings in easy access/cash ISA, theoretical ups and downs on S&S ISA (which I won't be touching unless the roof falls in) and any PB 'winnings'. 
When asked what my income is, what should I/would others say?

NedS

Asked by whom? I would say your income is zero, you are living off savings.

Stubod

..as above, zero as it does not look like you have any income at the mo...

Dazed_and_C0nfused

Basically any new money is made up of pennies in interest on savings in easy access/cash ISA, theoretical ups and downs on S&S ISA (which I won't be touching unless the roof falls in) and any PB 'winnings'. 

When asked what my income is, what should I/would others say?

Context is everything.  If you were asked for taxable income then it is pennies, which you could probably round down to zero.

But in a more literal sense I would say it is pennies plus premium bond winnings.

Dansmam

Thanks all for your replies. Yes it certainly feels like zero 😐. No one has asked as yet and I'd not planned to make any account changes this year but now I am inclined to try and dump a current account that no longer pays 3% to switch for their spend and save account, and expect the bank will be interested to know what I have coming in.
Will just sit tight for a year as originally planned I think. Or ring them. All part of the  mental adjustment -- while earning I'd just have applied online and expected the switch to happen.
Would be interesting to understand what people would say their income is if the cash is pension in flexible drawdown rather than in savings products.

TadleyBaggie

When asked my income I certainly include my regular SIPP drawdown amount as it is taxed.

Linton

What your income is depends on why the question was asked.  For example, if you are applying for a Lifetime Mortgage then money available from savings could be included as could drawdown.  If you want to claim benefits then in some cases pension assets are converted to equivalent income perhaps the basis of annuity rates.  

Generally give an answer that is not incorrect and is most beneficial to you.

If it is someone asking out of interest either tell them that it is not their business or perhaps just say living off "Private Means" .

Mickey666

Dansmam said:

I'm living on savings to bridge the gap before DB can sensibly be taken with a lower level of reduction for early payment in just over a year's time. 'Paying ' myself the equivalent of the projected pension meanwhile. Basically any new money is made up of pennies in interest on savings in easy access/cash ISA, theoretical ups and downs on S&S ISA (which I won't be touching unless the roof falls in) and any PB 'winnings'. 
When asked what my income is, what should I/would others say?

I did this for 10 years between retiring early and a deferred DB pension starting at 60.  During that time I applied for new credit cards and was faced with the 'income' question.  I called my bank to discuss my situation, ie no actual income but living comfortably on savings as part of my retirement plans, but they couldn't suggest anything. 

In the end I gave a figure equal to my average annual expenditure..  If it had challenged I would have argued that since I was spending £x each year (easily proven using my planning spreadsheets if necessary), and since I had no debts and was incurring no debts, then I must have an 'income' that covers my annual expenditure.

In the end, my stated 'income' figure was never questioned and I got my credit cards with no problems.

Dansmam

Thanks that's really helpful, good to know 👍🏻

Audaxer

As I'm retired and taking income from my S&S ISA to supplement DB pension income, I was assuming if asked for my income on an application, I could include an average amount drawn per year from my S&S ISA as part of my annual income, whether it be in the form of dividends or selling capital? 

Linton

Audaxer said:

As I'm retired and taking income from my S&S ISA to supplement DB pension income, I was assuming if asked for my income on an application, I could include an average amount drawn per year from my S&S ISA as part of my annual income, whether it be in the form of dividends or selling capital? 

If you are trying to get a mortgage or loan the lender would need more information to assess the affordability.  After all your current income when drawing down can be anything you want it to be up to the total value of your investments.  When I took out a mortgage the broker needed to talk directly with the underwriter to explain my situation - lending companies at that time did not seem to really understand drawdown.  Whether the situation has changed now I dont know.