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Pension/universal credit

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Jontowey
Jontowey Community member Posts: 12 Listener
My partner is my carer she currently works 12hrs a week we get UC I get pip both higher rates and I receive lcwra she is wanting to retire early this year preferably August before her state pension next year and wants to substitute her income with a draw down on a private pension per month to make up the UC loss she gets about £430 per month wages  and the pension would be worth  about£400 per month how would you go about telling UC and what would the Upshot be or downsides to doing this thanks

Comments

  • calcotti
    calcotti Community member Posts: 10,010 Disability Gamechanger
    edited May 2022
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    Drawing down a pension will be a waste of money. Unlike earnings any regular pension income is deducted in full from UC. If she takes £400/month of pension income the UC will go down by £400.

    Can I check - is she claiming the carer element of UC? If she looks after you for 35 hours/week she is entitled to this - it's worth an extra £168.81/month.

    Are you older or younger than her?
    Information I post is for England unless otherwise stated. Rules may be different in other parts of UK.
  • Jontowey
    Jontowey Community member Posts: 12 Listener
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    I am only 53 and she receives the carer element of uc
  • Jontowey
    Jontowey Community member Posts: 12 Listener
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    Reference to before my partner is struggling with the job and wants to finish early by taking 25%of her pension in a drawdown as substitute for uc
  • janer1967
    janer1967 Community member Posts: 21,964 Disability Gamechanger
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    I'm no expert but isnt it work income she will be losing rather than uc ? 

    @calcotti is the best person to advise 

    But I would be interested in the answer , wouldn't uc remain till state pension age 
  • poppy123456
    poppy123456 Community member Posts: 56,156 Disability Gamechanger
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    janer1967 said:
    I'm no expert but isnt it work income she will be losing rather than uc ? 

    @calcotti is the best person to advise 

    But I would be interested in the answer , wouldn't uc remain till state pension age 
    It would be both. As Calcotti has advised it’s pointless taking a pension income when claiming UC because it’s deducted £1 for £1. 
    Yes UC would continue here until both reached state pension age, unless the state pension and private pension reduces their UC to zero, which can happen depending on circumstances.
    I would appreciate it if members wouldn't tag me please. I have all notifcations turned off and wouldn't want a member thinking i'm being rude by not replying.
    If i see a question that i know the answer to i will try my best to help.
  • poppy123456
    poppy123456 Community member Posts: 56,156 Disability Gamechanger
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    Jontowey said:
    Reference to before my partner is struggling with the job and wants to finish early by taking 25%of her pension in a drawdown as substitute for uc
    It would be pointless taking a pension drawdown for the reasons stated above. 
    I would appreciate it if members wouldn't tag me please. I have all notifcations turned off and wouldn't want a member thinking i'm being rude by not replying.
    If i see a question that i know the answer to i will try my best to help.
  • calcotti
    calcotti Community member Posts: 10,010 Disability Gamechanger
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    If she stops work your UC will go up if there is currently an earnings deduction applied. However as you will currently have a Work Allowance your total income will undoubtedly drop. Unfortunately though you cannot make this up by taking regular pension income.

    Information I post is for England unless otherwise stated. Rules may be different in other parts of UK.
  • Jontowey
    Jontowey Community member Posts: 12 Listener
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    To calcotti how much would we lose if anything carers element lcwra she already gets carers allowance what do you suggest 
  • poppy123456
    poppy123456 Community member Posts: 56,156 Disability Gamechanger
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    Jontowey said:
    To calcotti how much would we lose if anything carers element lcwra she already gets carers allowance what do you suggest 

    If she takes a pension of £400 per month then it will reduce your UC by £400 because it's deducted £1 for £1. If she stops working then she will also lose her earnings of £430.
    I don't advise her to take any pension because as advised, it's completely pointless because it's just deducted in full.
    I would appreciate it if members wouldn't tag me please. I have all notifcations turned off and wouldn't want a member thinking i'm being rude by not replying.
    If i see a question that i know the answer to i will try my best to help.
  • calcotti
    calcotti Community member Posts: 10,010 Disability Gamechanger
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    Jontowey said:
    To calcotti how much would we lose if anything carers element lcwra she already gets carers allowance what do you suggest 
    As advised taking a pension is pointless because you get no benefit from it.
    Information I post is for England unless otherwise stated. Rules may be different in other parts of UK.
  • Jontowey
    Jontowey Community member Posts: 12 Listener
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    The whole point of taking part of the pension pot is to stop working period because it is getting too hard but what would dwp say if anything
  • poppy123456
    poppy123456 Community member Posts: 56,156 Disability Gamechanger
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    Jontowey said:
    The whole point of taking part of the pension pot is to stop working period because it is getting too hard but what would dwp say if anything
    I think you’re missing the point we are trying to make. There’s no point taking the pension because it just reduces your UC £1 for £1 so you won’t be financially better off.
    I would appreciate it if members wouldn't tag me please. I have all notifcations turned off and wouldn't want a member thinking i'm being rude by not replying.
    If i see a question that i know the answer to i will try my best to help.
  • calcotti
    calcotti Community member Posts: 10,010 Disability Gamechanger
    edited May 2022
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    I don’t know how many different ways we can say the same thing. While you are on UC you cannot increase your total income by claiming a pension.

    If your UC is X and then you claim a pension of Y the UC changes to X minus Y so your total income remains X. The only difference is that instead of all your money coming from the government you are using up some of your pension.
    Information I post is for England unless otherwise stated. Rules may be different in other parts of UK.
  • Jontowey
    Jontowey Community member Posts: 12 Listener
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    What I'm saying is it's all about finishing work early not about the pension pot
  • calcotti
    calcotti Community member Posts: 10,010 Disability Gamechanger
    edited May 2022
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    Jontowey said:
    What I'm saying is it's all about finishing work early not about the pension pot
    She can stop work if she wishes because, as a carer, she is not required to work.

    Your original post said you wanted to use a pension to substitute the earnings lost (so it was about the pension pot). What we have said is that this will not work.

    What you have to accept is that if she stops work your total income will fall.

    Information I post is for England unless otherwise stated. Rules may be different in other parts of UK.
  • poppy123456
    poppy123456 Community member Posts: 56,156 Disability Gamechanger
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    Jontowey said:
    What I'm saying is it's all about finishing work early not about the pension pot
    There will be no sanction if she finishes work because she’s claiming carers element. There’s no work commitments when claiming this. 
    I would appreciate it if members wouldn't tag me please. I have all notifcations turned off and wouldn't want a member thinking i'm being rude by not replying.
    If i see a question that i know the answer to i will try my best to help.
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