Defering Your State Old Age Pension

[fcc]

is it worth deferring o state old age pension?

[Gizmonster]

What you need is a crystal ball .....
If you were to die not long after your normal retirement date; then it would be foolish to defer.
If, however, you live to 100+ and you can afford to defer; then deferring would probably be better. I'm just assuming here, as this is without looking at the actual figures.

[EDDIE51]

I was told that the best bet if you don't need it immediately is to take it anyway but have it paid into an interest bearing saving account.

[woofgang]

I could have afforded to defer mine but I do not trust whoever is in power at the time not to change the rules again and refuse to pay out. Mine is going straight into an ISA

[Hymie]

The short answer is no.

By delaying your pension by a year, you will receive approximately a 5.8% increase.

If we ignore inflation and use round numbers; assuming that the state pension is £10,000 per annum, by delaying by a year your annual pension will be around £10,580.

But you will have missed out on £10,000 (the year you delayed) – to get that money back at £580/year will take over 17 years. So someone retiring now at age 65 would have to live until over 82 to recover the money – those retiring at a later age (coming soon) will have to live even longer.

[Hopkirk]

Hymie, if you are still working and receiving your state pension you would have paid income tax on that £10000. At 20 per cent that's only £8000 you actually get.