lump sum pension on sick
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antonjanekids
Community member Posts: 3 Listener
hi i am retairing on ill health i can draw down on my works pension which i will pay off some deit s about 9000 can i do this or will any off my benifits drop thanks
Comments
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I hope that you have sought advice before doing this when taking money out of your pension pot. Will the resulting pension payments be enough to live on during retirement?
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A drawn down lump sum from a pension will be classed as savings. For every £250 or part there of over £6,000 and your ESA will reduce by £1/week.If you do take this lump sum then you will need to report the changes to your ESA. It will be down to a decision maker to decide whether paying off your mortgage and reducing your savings will affect your ESA. In my opinion I can’t see paying off a mortgage is going to be seen as deprivation of capital but I’m not a decision maker.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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poppy123456 said:A drawn down lump sum from a pension will be classed as savings. For every £250 or part there of over £6,000 and your ESA will reduce by £1/week.If you do take this lump sum then you will need to report the changes to your ESA. It will be down to a decision maker to decide whether paying off your mortgage and reducing your savings will affect your ESA. In my opinion I can’t see paying off a mortgage is going to be seen as deprivation of capital but I’m not a decision maker.
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2oldcodgers said:poppy123456 said:A drawn down lump sum from a pension will be classed as savings. For every £250 or part there of over £6,000 and your ESA will reduce by £1/week.If you do take this lump sum then you will need to report the changes to your ESA. It will be down to a decision maker to decide whether paying off your mortgage and reducing your savings will affect your ESA. In my opinion I can’t see paying off a mortgage is going to be seen as deprivation of capital but I’m not a decision maker.
Your point being?
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. -
2oldcodgers said:poppy123456 said:A drawn down lump sum from a pension will be classed as savings. For every £250 or part there of over £6,000 and your ESA will reduce by £1/week.If you do take this lump sum then you will need to report the changes to your ESA. It will be down to a decision maker to decide whether paying off your mortgage and reducing your savings will affect your ESA. In my opinion I can’t see paying off a mortgage is going to be seen as deprivation of capital but I’m not a decision maker.
Money that is tied up in their own home be it equity or mortgage repayment is never used towards the £6000 limit.
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Indeed. It's also worth thinking about whether it's worth paying off the mortgage with that amount. If it pays off the motgage completely then yes it will be worth it. I'm not saying that the OP shouldn't do this though.
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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