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.

Even in my area - West of Scotland - where housing is cheaper you'll likely pay more than that for a three bedroom house with a garden. 130k for a two bedroom is average -flats tend to be cheaper

Some people have totally unforeseeable disasters. Some people put themselves in situations they could have seen a mile off or situations where they needed state support from day 1.

We can all have our own guesses at the ratio.

You have no basis for assuming OP could see into the future, you are just being a basic benefit basher that doesn’t apply any basic reasoning to their own argument. Completely pointless

You have no basis for assuming OP could see into the future

That's why I didn't say the OP could see into the future.

What’s wrong with living a 2 bed flat?

Nothing. I live in a flat myself. I was just pointing out that flats tend to be cheaper. Other people were posting assuming that the OPs friend is looking to buy a house.

She needs to go to a lawyer, put the money in a trust for her children so they can buy a property even if she can't. She shouldn't just "spaff" it away, that's a bit irresponsible.

I know this government don't want us having anything, I cant bear this country in many ways. But your friend needs proper advice on what to do with this money from a personal solicitor.

You can get help with mortgage interest whilst claiming means-tested benefits, but it comes in the form of a loan that has to be repaid at some point. This may well be when the house is sold, and the loan itself does incur interest.

That could be viewed as deprivation of capital

It's completely unfair that someone tries to game the system by spending or tying up money so that she can keep benefits - she doesn't need advice from a solicitor. There are dwp staff on reddit who absolutely know the rules about this kind of situation and who would be able to advise her accordingly

She absolutely cannot put it in trust for her children.

The lady has 3 kids. Of who knows what sex.
Even if it was 3 boys / 3 girls, 3 kids in one room is a squeeze.

What would be the point in doing that and taking on the risk of ownership if its not actually going to enhance the lady and her kids life?

Not every social housing area is a complete dive. There are some nice areas.

I can totally see why this lady feels stuck.

£125k should be able to make a huge difference to her life, give her a leg up.
But reality working full-time isn't enough to support a family she's always going to end up teetering around the benefits threshold.

Full-time wages are too low.
The gap between benefits and working is too little.

And house prices are too high.
Its a shit show.

Because she's going to probably have to buy a property or do shared ownership or she'll have to come off benefits? She's not going to have a choice. She'll either have to spend it as per dwp rules or come off benefits and live off the cash

Perhaps or perhaps not, which is why she needs professional advice. If she has 125k she can afford a few grand to get a proper understanding of where she stands. That's what I would do.

That is deprivation. Tying it up in trust

There are specialist boards staffed by dwp staff on reddit

Sadly it's too late to put it in trust for her kids. Which is a pity as it could really break the cycle and get them off to a better adult life.

I'm someone who doesn't want to see someone get done for fraud. Hope that clarifies.

The idea of part ownership is spot on. Pity someone else can't 'buy' it In their name and rent it. Or first d a trusted relative and put it in a dedicated account.
As A-H of the year I would oint out that benefits are a safety net and not an absolute entitlement. If you have the means to pay then you should. However this situation is a grossly unfair exception.

If she went back to claiming UC, she would be able to get a loan, via their system, to cover the interest payments on the mortgage.

The dwp have the right to spot check accounts going back years. If someone gave 125k to a relative to buy a flat and they rented it out - and the person continued to claim benefits and were later found out they would very likely be prosecuted for fraud. It's not worth a potential criminal record

This

Why do you think it’s unfair -
? if an elderly single pensioner came on here who got their rent covered off and was housed but basically only had state pension suddenly came into £125k I think most people would expect that money to be used to pay their rent and give a bit of a boost to life until they were at the level of only having £16k left before they could claim anything - if OP doesn’t want to buy something outright or almost outright in a very very cheap area ( and not move to north east/west or Scotland) or buy into shared ownership then the most sensible option is to invest the money , stay in housing association, come off benefits, put some into ISAs if she can, put a bit aside for kids, ( maybe £5k each) take maybe 8 to 12k a year out to cover off rent /council tax ( plus she will have her wages and will get some decent interest ) - replace any furniture with hard wearing good quality stuff, pay off any debt etc, etc - just put herself in a better position going forward for a good few years . It certainly isn’t grossly unfair - any single mum or couple not on benefits, even if only slightly over the limit to claim would have to do this - she most certainly doesn’t have to ‘spaff it’ and risk the DWP coming back to claim their benefits back

I don't think it's grossly unfair. It's a decent enough sum of money. She can either live off it and come off benefits or buy a property which means she'll be able to stay on benefits. I don't see anything unfair about someone being able to use winnings to buy a house.

What she can't do is just burn through it and keep claiming or have it sitting in the bank and keep claiming.

It's the same as if someone gets disability payments backdated. Some people do have to fight for years to get back payments and there's a years disregard but it's always been the case that if you have a over 16k in the bank your benefits stop

She's not living in a housing association house as far as the first post said. She's paying to a private landlord which will be more expensive which is clearly part of the problem. If she comes off benefits she'll be paying more than she would if she were in social housing