Sad for my friends £125k lottery win.

[Sogfree]

£125k win on the postcode lottery.

Single mum to 3 children (all primary age). Works as a TA, so receiving benefits to top up her income.

She would like to use her winnings for a deposit on a house. But due to the benefits rules not being allowed to pay a mortgage, she can't buy a property.

So she's going to spaff the entire lot as quick as she can, and the government will continue to pay rent to a multi property owner and make them richer.

The only asset she'll get to keep is a newer car - not anything fancy as she knows she won't be able to afford the insurance/fuel once the winnings run out.

Her one chance of breaking free of a life on benefits and she's got to throw it away. It feels wrong.

I agree with this really.

Of course you can own a home!

I'm disabled, own my home and receive benefits (not proud of that but it is what it is for now).

Definitely post her off to the Citizens Advice Bureau, tell her to get advice for sure. £125k? She'll never get that sum again, she needs to be clever. It's a life changing about, not a piss it up the wall on crap amount.

This entirely.
Ridiculous post!

Except she cannot invest it in her children’s name, that would be deprivation of assets.

Thats the issue if she blows it on holidays it will be seen as deprivation of assets.

Unless she can find a way of investing it in property then its just going to go in living costs.
I'm assuming with 3 kids she'd really struggle to lift herself clear of benefits with earnings.
Even if she was to work full-time and pay childcare.

Actually thats probably a big part of the issues in the UK. People working in a full-time role should not also be needing top-up means tested benefits.
A full-time job should be more than able to pay rent, or mortgage and general living expenses

Of course you can own a property and claim benefits. Do you think if you lose your job or suddenly become disabled they make you sell your house. They obviously won't pay your mortgage but most people on benefits work so use that money to pay their mortgage me included.

Why is it?
Surely it's fair that UC goes to people who need it? Not people with 125k on savings?
There is nothing stopping her from using the money for a deposit. Defending where she lives 125k would buy a house outright anyway.
She can still claim UC she just won't get the housing benefit element of it she might though be able to get support for the interest element of the mortgage.

In any any sane world that £125k would be spent on feeding and housing her rather than the tax payer doing it.

She could put some of it into a SIPP and/or JSIPPs for her kids. No need to pay a financial advisor for help with this, rebel finance school do a free you tube course (although they usually take the videos of the previous course down at the end of the financial year)

It's not true that you can't own property.
The issue is that once she has the winnings her benefit will stop and she has to live on it. If she gets rid of it deliberately in order to go back on benefits it's called deprivation of assets. Whether she gives it to her children or puts it on a horse doesn't matter it's the intention.

What she could do is live frugally, get a job and have some savings behind her either for a house deposit or a long term cushion.

DWP won’t pay your mortgage is what OP means. You can get a loan called support for mortgage interest but it’s repayable.

How much are houses where you are?
Everyone's goal should be to get off benefits and she's trying to work out the best way to stay on them? What a fool.
She should buy a house, that'd be a 50% deposit on a decent-ish house here. Use her wages to pay the mortgage like most have to. She can still get benefits for living costs can't she??

You can own a property. Sound like your friend has already made her mind up and just wants to splash the lot on holidays and crap. I certainly wouldn't be feeling sorry for her.

I did think thats is how it would be seen.

Is your friend aware that she needs to report the winnings to DWP
If your total capital exceeds £16,000, you are not entitled to Universal Credit.
You must report any changes to your savings, assets, or investments via your online journal.
While winnings are not taxed by HMRC, large amounts that increase your bank balance must be reported as capital
You cannot simply give the money away or hide it to keep your benefits (deprivation of capital).

Or she could pay her mortgage the way other homeowners do. 125k will go a long way to buying a house and then she needs to suck it up and pay the mortgage. I am a single mom who relies on universal credit to top me up and I pay my own mortgage. I’m not rolling it by any means but I can afford to live and have the comfort of knowing one day my house will be paid off and not have to worry about paying rent. I mean what will she do when the kids are grown, who will pay the rent then. What a ridiculous post.

If she’s really stupid and feckless enough to ‘spaff the lot’, then IMO she deserves zero sympathy from anyone.

As pps have said, a part-ownership property would be a way forward.

I've just had almost a year dealing with a similar situation, so I'm informed.

Your friend can absolutely buy a house and it can be disregarded as depravation of assets IF it's the only property she owns, she lives in it full time as her primary residence, she did it to secure a better home for herself and her children and didn't do it to deliberately deprive herself of assets just to stay on benefits.
She can also spend it on paying off any debt she has - all debt payments are also disregarded.
She can also pay for training courses, driving lessons, and a car - provided the car isn't extravagant.

She cannot, however, put the money into savings of any kind for herself or anyone else. She cannot give anyone any money, unfortunately not even her children, as that is seen as moving money around to deprive herself of assets.

I bought a three bedroomed end terraced house for £94k in a very nice northern village outright. It's very doable in many places around the UK

So she’s not happy that she loses tax payers money that’s meant to support hardship and vulnerable people , but sat on 125k. How about paying your own way for abit ?

I've read a few pages now and not really seen any viable solutions. Putting money in savings for the kids still loses her her benefits. Buying a house for 4 of them to live comfortably in might not be possible in her area for 125k. Those suggesting partial ownership presumably haven't read about the massive pitfalls of this. Getting a mortgage (I wonder how many people know what TAs get paid) might only extend her amount to around 185k which may well buy a bigger house (although it wouldn't stretch to much in my area and she has her mum to care for so can't move). Then you have mortgage payments to pay which obviously UC doesn't cover... How much the work allowance goes up and how the mortgage repayments would compare to how her rent is covered by benefits now is anyones guess. Financial advice would be necessary, but just to assume this is the obvious solution seems just as stupid to me!

Paying for qualifications whilst using the money to live off is probably the most sensible idea yet, however even this creates problems. If she's solo caring for 3 kids and her mum, maybe term time suits her. To go full time following whatever qualification, you'd have to have a massive increase in income to cover the increase in childcare costs (even with qualifications, you don't just walk into a top salary). Suggesting to train as a teacher is also not the obvious solution for many reasons. If she doesn't have a degree, that could be a lengthy process and not likely to be achievable before the 125k runs out.

If she ends up using the money to live off and then going back on benefits, she might get a qualification out of it which is better than she would've had otherwise (and definitely something to be grateful for) but I'm sure what OP is sad about is the fact that winning 125k doesn't make as much impact as you'd perhaps expect and people who were better off to start with might ironically get more immediate benefit.

you can do degree apprenticeships in teaching, and many other things, so she can earn and use her lotto winnings to top up her earnings for 3-4 years.

also, ‘lose her her benefits’ she doesn’t NEED benefits now. They can all live off the winnings, and live in a luxury way, pay off her her debts etc and then she can go back on benefits later if she still needs them

Your friend needs to be very careful - spending it as quick as possible on frivilous things would be classed as deprivation of assets and would likely leave her inelligble for benefits.
As others have said she needs to look into shared ownership or homes within her budget with a 125k deposit. You absolutely can still be entitled to UC with a mortgage - in fact you can earn more before seeing deductions if you do not have the housing element

Even if she’s in expensive London she could buy this shared ownership flat almost outright (just needs a tiny little mortgage on top https://www.rightmove.co.uk/properties/155823356#/?channel=RES_NEW) with a swimming pool! And uc would cover her rent and the service charge, lucky woman. She’d have security for life. The risk of flats is a service charge increase but if she’s on benefits she’d be fine.

Is part ownership and shared ownership the same thing?