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Adding to a Pension after Retirement?

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
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Comments

  • Bimbly
    Bimbly Posts: 497 Forumite
    Seventh Anniversary 100 Posts Name Dropper Combo Breaker
    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.
  • Marcon
    Marcon Posts: 12,920 Forumite
    Eighth Anniversary 10,000 Posts Name Dropper Combo Breaker
    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
    The financial secrecy of your dad's generation...makes it rather hard to help, doesn't it?

    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!  
  • Nebulous2
    Nebulous2 Posts: 5,501 Forumite
    Part of the Furniture 1,000 Posts Name Dropper
    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. 
  • hayley11
    hayley11 Posts: 7,627 Forumite
    Part of the Furniture 1,000 Posts Combo Breaker
    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
    The financial secrecy of your dad's generation...makes it rather hard to help, doesn't it?

    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)?
    Thanks, he has had pensions but he withdrew one years ago and as far as I know that's gone, and he withdrew one recently with about £4k in so now all his money is in his bank account. He doesn't have any more as far as he knows, he opted out most of the time as far as I can tell.

    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
  • hayley11
    hayley11 Posts: 7,627 Forumite
    Part of the Furniture 1,000 Posts Combo Breaker
    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. 
    He gets the basic state pension as far as I know, I'll try to check that with him. He lives in a council flat, he's single, we've done lots on his outgoings to bring them down as much as possible. It's unlikely he will get work now, even if there was a job for just a few hours a week nearby, he's not qualified for anything, he can't drive, he's got this shaking thing, bit like Parkinson's but isn't, his knees and back aren't great, he carried on working a year after he could have retired because he wanted more money but he couldn't manage it any longer. I've tried showing him ways to increase his money, surveys and whatnot but he's terrible with computers. 
    :heart: Think happy & you'll be happy :heart:
    I :heart2: my doggies
  • xylophone
    xylophone Posts: 45,426 Forumite
    Part of the Furniture 10,000 Posts Name Dropper
    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
  • hayley11
    hayley11 Posts: 7,627 Forumite
    Part of the Furniture 1,000 Posts Combo Breaker
    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
    Thanks, no we don't think he would qualify, he doesn't feel able to work but he doesn't require any care or support like that. And thanks, yes I think I was barking up the wrong tree with the pension thing. Will have to keep thinking of ways to improve his situation. 
    :heart: Think happy & you'll be happy :heart:
    I :heart2: my doggies
  • Easyjet77
    Easyjet77 Posts: 110 Forumite
    100 Posts Second Anniversary Name Dropper
    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.pdf
    Thanks, no we don't think he would qualify, he doesn't feel able to work but he doesn't require any care or support like that. And thanks, yes I think I was barking up the wrong tree with the pension thing. Will have to keep thinking of ways to improve his situation. 
    Hayley11, please have a look into attendance allowance,  as suggested. It is not means tested and there is a wide variety of qualification reasons. Regards 
  • Grumpy_chap
    Grumpy_chap Posts: 16,989 Forumite
    Tenth Anniversary 10,000 Posts Name Dropper Combo Breaker
    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.

    Does he have the full state pension?
    That may be more income than would allow him to qualify for pension credit in any case.
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