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Topic: Re:Re:Re:Re:Re:Re:Re:Re:Re:Re:Taking my State Pension - help please !
Posted by: Sam Hearn
Date/Time: 09/05/15 12:58:00

The ten year payback period ignores the impact of inflation (a pound in year 5 will buy less than a pound in year one) and any interest/dividends earned on the pension if some or all of it were invested as Maggie suggests that she will. The impact of inflation will make the payback period longer.

Whether or not Maggie's pension is taxable (all or in part) depends on how much her part time earnings are. The current tax free allowance is 10,500 and maximum state pension is I think 6,029.40 PA. You can do the maths.

It is quite difficult to calculate the notional break-even payback period since the pension is (thanks to the coalition government) going to increase by the greater of i) the average percentage growth in wages ii) the percentage growth in prices measured by the Consumer Prices Index (CPI) or iii) 2.5%.

I think that this should reduce the notional payback period.

However as Maggie intends to invest her pension in an ISA you need also to bear in mind that the ISA may well go up in value and that the tax free income from it will go up over time (especially if it is reinvested). This will increase the notional break-even payback period.

For those with substantial savings and investments it may be sensible to draw down the pension at the earliest opportunity and make regular gifts to children, grandchildren etc thereby reducing the inheritance tax on your estate on death. You cannot take it with you.


All of this needs to be checked on with a professional adviser.


Entire Thread
TopicDate PostedPosted By
Taking my State Pension - help please !08/05/15 15:48:00 Maggie Dodge
   Re:Taking my State Pension - help please !08/05/15 16:12:00 Richard Greenhough
      Re:Re:Taking my State Pension - help please !08/05/15 16:29:00 Vanessa Smith
   Re:Taking my State Pension - help please !08/05/15 16:25:00 Jonathan Bingham
      Re:Re:Taking my State Pension - help please !08/05/15 17:01:00 James Roy
         Re:Re:Re:Taking my State Pension - help please !08/05/15 17:07:00 Maggie Dodge
            Re:Taking my State Pension - help please !08/05/15 18:00:00 Phil Kay
            Re:Re:Re:Re:Taking my State Pension - help please !08/05/15 18:15:00 Robert Fish
               Re:Re:Re:Re:Re:Taking my State Pension - help please !08/05/15 19:46:00 Andy Pease
                  Re:Re:Re:Re:Re:Re:Taking my State Pension - help please !08/05/15 20:48:00 Maggie Dodge
               Re:Re:Re:Re:Re:Taking my State Pension - help please !08/05/15 20:56:00 Maggie Dodge
                  Re:Re:Re:Re:Re:Re:Taking my State Pension - help please !08/05/15 23:58:00 Mark Perry
                     Re:Re:Re:Re:Re:Re:Re:Taking my State Pension - help please !09/05/15 08:17:00 Maggie Dodge
                        Re:Re:Re:Re:Re:Re:Re:Re:Taking my State Pension - help please !09/05/15 08:36:00 Micki Hawkes
                           Re:Re:Re:Re:Re:Re:Re:Re:Re:Taking my State Pension - help please !09/05/15 11:33:00 Maggie Dodge
                              Re:Re:Re:Re:Re:Re:Re:Re:Re:Re:Taking my State Pension - help please !09/05/15 11:56:00 Gerry Tan
                           Re:Re:Re:Re:Re:Re:Re:Re:Re:Taking my State Pension - help please !09/05/15 11:35:00 Stephen Gould
                              Re:Re:Re:Re:Re:Re:Re:Re:Re:Re:Taking my State Pension - help please !09/05/15 12:58:00 Sam Hearn
                                 Re:Re:Re:Re:Re:Re:Re:Re:Re:Re:Re:Taking my State Pension - help please !09/05/15 19:36:00 Maggie Dodge
                                    Re:Re:Re:Re:Re:Re:Re:Re:Re:Re:Re:Re:Taking my State Pension - help please !09/05/15 21:52:00 Jill Merrett
                                       Re:Re:Re:Re:Re:Re:Re:Re:Re:Re:Re:Re:Re:Taking my State Pension - help please !10/05/15 07:36:00 Micki Hawkes
                                          Re:Re:Re:Re:Re:Re:Re:Re:Re:Re:Re:Re:Re:Re:Taking my State Pension - help please !10/05/15 07:42:00 Micki Hawkes
                                             Re:Re:Re:Re:Re:Re:Re:Re:Re:Re:Re:Re:Re:Re:Re:Taking my State Pension - help please !10/05/15 09:35:00 Maggie Dodge
                                                Re:Re:Re:Re:Re:Re:Re:Re:Re:Re:Re:Re:Re:Re:Re:Re:Taking my State Pension - help please !10/05/15 17:01:00 James Roy
                                                   IDS to re-brand the state pension12/05/15 08:14:00 Janine Jarvis
                                                      Re:Stop the Tory Bashing lies - NOW12/05/15 09:14:00 Sam Hearn
                                                         Re:Re:Stop the Tory Bashing lies - NOW12/05/15 09:20:00 Maggie Dodge
                                                            Re:Re:Re:Stop the Tory Bashing lies - NOW12/05/15 11:45:00 Lou Valdini
                                                         Re:Re:Stop the Tory Bashing lies - NOW12/05/15 11:55:00 James Roy
                                                         Re:Re:Stop the Tory Bashing lies - NOW12/05/15 11:55:00 James Roy
                                                            Re:Re:Re:Stop the Tory Bashing lies - NOW12/05/15 13:22:00 Sam Hearn
                                                               Re:Re:Re:Re:Stop the Tory Bashing lies - NOW12/05/15 16:06:00 James Roy
                                                                  Deferring your state pension12/05/15 16:13:00 Bernard Allen
                                                                     Re:Deferring your state pension12/05/15 16:50:00 Sam Hearn
                                                                        Re:Re:Deferring your state pension12/05/15 17:09:00 Will Watson
                                                                           Re:Re:Re:Deferring your state pension12/05/15 17:41:00 Bernard Allen
                                                                              Re:Re:Re:Re:Deferring your state pension12/05/15 18:27:00 Chris Lucy
                                                                                 Re:Re:Re:Re:Re:Deferring your state pension12/05/15 19:38:00 Micki Hawkes
                                                                                    Re:Re:Re:Re:Re:Re:Deferring your state pension12/05/15 20:40:00 Sam Hearn
                                                                                       Re:Re:Re:Re:Re:Re:Re:Deferring your state pension13/05/15 12:12:00 Will Watson
                                                                              Re:Re:Re:Re:Deferring your state pension12/05/15 22:01:00 Susan Kelly
                                                                                 Re:Re:Re:Re:Re:Deferring your state pension12/05/15 22:34:00 Bernard Allen
                                                                                    Re:Re:Re:Re:Re:Re:Deferring your state pension13/05/15 09:49:00 Susan Kelly
                                                                                       Re:Re:Re:Re:Re:Re:Re:Deferring your state pension13/05/15 11:49:00 Bernard Allen
                                                                                          Re:Re:Re:Re:Re:Re:Re:Re:Deferring your state pension13/05/15 19:18:00 Susan Kelly
                                                                              Re:Re:Re:Re:Deferring your state pension12/05/15 22:10:00 Will Watson
                                                                                 Re:Re:Re:Re:Re:Deferring your state pension12/05/15 22:27:00 Bernard Allen
                                                                                    Re:Re:Re:Re:Re:Re:Deferring your state pension13/05/15 09:27:00 Sam Hearn
                                                                                       Re:Re:Re:Re:Re:Re:Re:Deferring your state pension13/05/15 11:43:00 Bernard Allen
                                                                                          Re:Re:Re:Re:Re:Re:Re:Re:Deferring your state pension13/05/15 12:45:00 Sam Hearn
                                                                                             Re:Re:Re:Re:Re:Re:Re:Re:Re:Deferring your state pension13/05/15 20:45:00 James Roy
                                                                                                Re:Re:Re:Re:Re:Re:Re:Re:Re:Re:Deferring your state pension23/05/15 17:43:00 Joe Conneely
                                                                                                   Re:Deferring27/05/15 12:37:00 Maggie Dodge
                                                                                                      Re:Re:Deferring27/05/15 16:06:00 Joe Conneely
                                                                                                      Re:Re:Deferring27/05/15 16:26:00 Vanessa Smith
                                                                                                         Re:Re:Re:Deferring27/05/15 16:49:00 Micki Hawkes
                                                                                                            Re:Re:Re:Re:Deferring27/05/15 17:09:00 Maggie Dodge

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