Overpaying pension on UC? Or overpaying mortgage?

CatLover30

Hello,

I didn't realise for years I was entitled to UC, I was also a student for many years. This has resulted in me habitually not spending much. Now that I have UC money is building up in my account very quickly and has taken me over the savings limit (though this is currently disregarded due to being backdated benefits payments). 

I don't know what to do about this. I could:

1. Overpay mortgage. Though my interest is only 3.59 percent for the next 5 years.

2. Pay extra into workplace pension. This would be quite efficient as I am taxed at 40% and then UC is reduced by 55p for ever £1 earned. I am not so good at maths but I think this means that to put £1 into my pension I would lose 27 pence from my actual money available.

3. Give the money to my dad. My dad has always been very generous including giving me 50k to buy a house. However, he now has no job, home, income or pension (except state pension). He is over 100k in debt on cards and considering a debt solution. He previously had income over 500k but I guess had some spending/budgeting issues that might be ongoing.

What would you do?

squirrelpie

What do you mean by 'UC'?

CatLover30

universal credit

squirrelpie

Thanks. I don't understand how you earn enough to be taxed at 40% and still qualify for UC?

CatLover30

It's actually not unusual. It is due to having disabled family members.

marcia_

squirrelpie said:

Thanks. I don't understand how you earn enough to be taxed at 40% and still qualify for UC?

 Depends on the elements of uc apply. There could be multiple children, disabilities with different family members and one person might be a carer