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Adding to a Pension after Retirement?

hayley11
Posts: 7,627 Forumite


My dad is 67 and retired in January, he's terrible with money and he's very private with it so it's difficult to help him as I don't have all the facts.
Anyway what I do know is that he has too much in his bank account to qualify for pension credit but my guess is that it's under £20k, probably much lower, this is the only money he has now apart from the state pension. He has no private pensions or any other form of income.
So I wondered, could he add a lump sum to a pension even now he's retired, and bring his savings under £10k? And then just draw a small amount each month? Is that dodgy?
I'm just trying to think of how to help him because he's so worried about money now he's retired and he's convinced he's going to run out of savings and only have the state pension to live on.
Thanks
Anyway what I do know is that he has too much in his bank account to qualify for pension credit but my guess is that it's under £20k, probably much lower, this is the only money he has now apart from the state pension. He has no private pensions or any other form of income.
So I wondered, could he add a lump sum to a pension even now he's retired, and bring his savings under £10k? And then just draw a small amount each month? Is that dodgy?
I'm just trying to think of how to help him because he's so worried about money now he's retired and he's convinced he's going to run out of savings and only have the state pension to live on.
Thanks
:heart: Think happy & you'll be happy :heart:
I :heart2: my doggies
I :heart2: my doggies
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Comments
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As your dad is not in work, he has no relevant earnings. However, he can still add £2,880 per year to a pension. The government will add £720 in tax relief. https://www.moneyhelper.org.uk/en/pensions-and-retirement/tax-and-pensions/tax-relief-and-your-pension#:~:text=The%20maximum%20you%20can%20contribute,and%20added%20to%20your%20pension.
He can keep this in the pension or withdraw it. He can keep it in cash without investing if he would prefer (ie, if he were to take it out again quickly). Pension providers such as Hargreaves Lansdown, AJ Bell, Interactive Investor would be worth looking at.
In the scenario you describe, it would take four years to put in £10k+ in this way.0 -
hayley11 said:My dad is 67 and retired in January, he's terrible with money and he's very private with it so it's difficult to help him as I don't have all the facts.
Anyway what I do know is that he has too much in his bank account to qualify for pension credit but my guess is that it's under £20k, probably much lower, this is the only money he has now apart from the state pension. He has no private pensions or any other form of income.
So I wondered, could he add a lump sum to a pension even now he's retired, and bring his savings under £10k? And then just draw a small amount each month? Is that dodgy?
I'm just trying to think of how to help him because he's so worried about money now he's retired and he's convinced he's going to run out of savings and only have the state pension to live on.
Thanks
Maybe refer him to this guide, which is pretty straightforward, and let him work through it on his own as he doesn't want to share financial info with you: https://www.citizensadvice.org.uk/benefits/help-if-on-a-low-income/pension-credit/before-you-claim-pension-credit/check-if-you-can-get-pension-credit/
Is he absolutely sure he has no pension benefits of any sort? Has he ever been an employee (as opposed to self employed), and if so, any idea of the dates/duration of his employment(s)?Googling on your question might have been both quicker and easier, if you're only after simple facts rather than opinions!0 -
This could be difficult and he really needs some advice. He could book an appointment with Pension Wise to discuss.
This is based on my (limited) understanding. Does he get the full state pension? That is set just above the pension credit level, so his pension might disqualify him from pension credit anyway.
He can contribute to a private pension, but once he is past state pension age a private pension which he hasn't drawn will be assessed as income and will further move him out of reach of pension credit.
What are his other circumstances? Does he own a home? Have a partner who he can share costs with? What are his outgoings? Is he used to spending much more than his current pension, or could he break even with a few adjustments?
Basically, as is generally the case with finances, there are two options, increase his income, or spend less. That can be easier said than done.
Could he work, even a few hours a week? I'm in a small town where a lot of people are working past retirement age. We have carers in their 70s, a food delivery driver in his late 70s, shopkeepers in their 70s. I think that is a trend that will grow, particularly if people reach pension age in good health.
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Marcon said:hayley11 said:My dad is 67 and retired in January, he's terrible with money and he's very private with it so it's difficult to help him as I don't have all the facts.
Anyway what I do know is that he has too much in his bank account to qualify for pension credit but my guess is that it's under £20k, probably much lower, this is the only money he has now apart from the state pension. He has no private pensions or any other form of income.
So I wondered, could he add a lump sum to a pension even now he's retired, and bring his savings under £10k? And then just draw a small amount each month? Is that dodgy?
I'm just trying to think of how to help him because he's so worried about money now he's retired and he's convinced he's going to run out of savings and only have the state pension to live on.
Thanks
Maybe refer him to this guide, which is pretty straightforward, and let him work through it on his own as he doesn't want to share financial info with you: https://www.citizensadvice.org.uk/benefits/help-if-on-a-low-income/pension-credit/before-you-claim-pension-credit/check-if-you-can-get-pension-credit/
Is he absolutely sure he has no pension benefits of any sort? Has he ever been an employee (as opposed to self employed), and if so, any idea of the dates/duration of his employment(s)?
It really does make it hard! I keep telling him I don't want any of it (my sister is forever scrounging so that doesn't help) and that I only want to know details to help him be as comfortable as he can be but he won't budge.
:heart: Think happy & you'll be happy :heart:
I :heart2: my doggies
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Nebulous2 said:This could be difficult and he really needs some advice. He could book an appointment with Pension Wise to discuss.
This is based on my (limited) understanding. Does he get the full state pension? That is set just above the pension credit level, so his pension might disqualify him from pension credit anyway.
He can contribute to a private pension, but once he is past state pension age a private pension which he hasn't drawn will be assessed as income and will further move him out of reach of pension credit.
What are his other circumstances? Does he own a home? Have a partner who he can share costs with? What are his outgoings? Is he used to spending much more than his current pension, or could he break even with a few adjustments?
Basically, as is generally the case with finances, there are two options, increase his income, or spend less. That can be easier said than done.
Could he work, even a few hours a week? I'm in a small town where a lot of people are working past retirement age. We have carers in their 70s, a food delivery driver in his late 70s, shopkeepers in their 70s. I think that is a trend that will grow, particularly if people reach pension age in good health.:heart: Think happy & you'll be happy :heart:
I :heart2: my doggies
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The point is that if your father starts a pension and contributes the net £2880 and receives the TR as explained above, if he claimed means tested benefits, that pension would be taken into consideration as he is over PC age.
https://www.gov.uk/government/publications/pension-freedoms-and-dwp-benefits/pension-freedoms-and-dwp-benefits
Here is the Fact sheet on PC.
https://www.ageuk.org.uk/globalassets/age-uk/documents/factsheets/large-print-factsheets/fs48-lp-pension-credit.pdf
Would he be eligible for Attendance Allowance?
https://www.ageuk.org.uk/globalassets/age-uk/documents/factsheets/fs34_attendance_allowance_fcs.pdf
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xylophone said:The point is that if your father starts a pension and contributes the net £2880 and receives the TR as explained above, if he claimed means tested benefits, that pension would be taken into consideration as he is over PC age.
https://www.gov.uk/government/publications/pension-freedoms-and-dwp-benefits/pension-freedoms-and-dwp-benefits
Here is the Fact sheet on PC.
https://www.ageuk.org.uk/globalassets/age-uk/documents/factsheets/large-print-factsheets/fs48-lp-pension-credit.pdf
Would he be eligible for Attendance Allowance?
https://www.ageuk.org.uk/globalassets/age-uk/documents/factsheets/fs34_attendance_allowance_fcs.pdf:heart: Think happy & you'll be happy :heart:
I :heart2: my doggies
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hayley11 said:Hayley11xylophone said:The point is that if your father starts a pension and contributes the net £2880 and receives the TR as explained above, if he claimed means tested benefits, that pension would be taken into consideration as he is over PC age.
https://www.gov.uk/government/publications/pension-freedoms-and-dwp-benefits/pension-freedoms-and-dwp-benefits
Here is the Fact sheet on PC.
https://www.ageuk.org.uk/globalassets/age-uk/documents/factsheets/large-print-factsheets/fs48-lp-pension-credit.pdf
Would he be eligible for Attendance Allowance?
https://www.ageuk.org.uk/globalassets/age-uk/documents/factsheets/fs34_attendance_allowance_fcs.pdf0 -
hayley11 said:
I'm just trying to think of how to help him because he's so worried about money now he's retired and he's convinced he's going to run out of savings and only have the state pension to live on.
That may be more income than would allow him to qualify for pension credit in any case.0
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