Private pension and ESA

picchy
picchy Online Community Member Posts: 7 Connected
edited October 2021 in Benefits and income
Hi there,

I'm 45 and looking to start a private pension. I receive income related esa and housing benefit. 

When I reach the age you could drawdown a private pension, currently 55, does anyone know if it would then be treated as capital / savings? I would have no intention of actually accessing the money until I reach state retirement age.

Many thanks for any help,
Picchy

Comments

  • poppy123456
    poppy123456 Online Community Member Posts: 64,456 Championing
    HI,

    Lump sums are treated as savings. Weekly/monthly income from that pension will be classed as income and reduce your Income Related ESA £1 for £1. If any part of your ESA is Contributions based then any pension of up to £85 per week is ignored but anything over that will reduce your ESA further by 50p for every £1 over £85 per week.

    However, as you are only 45 now then things could change by the time you reach the age in which you can withdraw from it so you will need to get futher advice when the time comes.

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