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Universal Credit & Pension

(4 Posts)
changeoflife Fri 17-Jul-15 19:05:25


I'm after some financial advise regarding an endowment policy I have that is due to mature soon. I'm a single parent now, 2 young kids, but have had the endowment going for almost 25years. I've paid into it (not attached to a mortgage anymore) as a way of ensuring I saved something for my eventual pension.

Since splitting up with my h I've continued to pay the endowment with the intention that when it matured I would invest it into a pension plan as I'm no longer going to get any of my exh pension and have no other pensions myself.

However since being a single parent I've been claiming ctc and wtc. I work but in a low paid job, 29hours a week.

I appreciate that when the endowment matures this will class as income and I won't be eligible for tax credits for the next tax year. However I'm confused now as to whether or not I should put the endowment into a pension plan at all. Would this country as deprivation of assets and so I wouldn't be able to put in a new claim which would then be Universal Credit.

Should I live off the lump sum then have no pension when I retire? I've saved this money thinking it would provide a small pension but am scared to put it into a pension pot if I'm doing something wrong!!

Can anyone help? If I put it into the pension will it make me unable to claim Universal Credit and not able to access the capital to live on too?

changeoflife Fri 17-Jul-15 19:08:02

count as deprivation of assets not country!

RedHelenB Sat 18-Jul-15 08:02:55

Could it pay off your mortgage? Actually, I think it would be savings rather than income so can't see why you shouldn't put it in a pension and carry on claiming tax credits.

changeoflife Sat 18-Jul-15 11:55:37

I can't pay off the mortgage because my exh pays it with an agreement that when we eventually sell we will split the profit 50/50. If I pay it off with this money he will then get 50% of the endowment via the house, and again I have no pension whilst he keeps all of his as per our financial agreement.

I think that some of the endowment will be savings, some of it income but I think under Universal Credit you can only have upto £16,000 in savings before becoming ineligible for any.

My dilemma is whether to risk putting it into a pension plan and it being regarded as deprivation of assets. I think that most likely it will be which will mean I need to live on that money and then have no pension. Its all so confusing!

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