To be gutted at losing my benefit

[Clappingforjoy]

I am going to inherit some money from sale of parents house and have told universal credit to close my claim but I'm gutted about it.
I have always struggled never had 2 Penny's to rub together and it just so happens I will go over the 16000 mark with this money and know i must sound greedy but my income is very low and i am scared this money will all go on living costs.

Pension, pension, pension....

One poster said these don't count as assets and I suspect that given you don't have access to it until retirement that it wouldn't be deprivation of assets but worth checking out.

In practical terms, there are some very very cheap properties out there that you could buy without a mortgage and end up with security of owning your own home for life. Something like this would be suitable, depending on where you live, although there are even cheaper out there.

www.rightmove.co.uk/properties/75610569#/

Use the money sensibly and keep receipts for everything. look up the deprivation of capital rules.

Could you invest the £10k that is over the savings threshold in buying items wholesale to sell on Amazon or ebay? You could then keep investing the money you make back into the business. Obviously you will lose benefits once you start taking profits out of the business but you will have used your inheritance to make money and support yourself rather than having to use it to survive.

@OffredOfjune

Some of the hard of reading on this thread also can’t seem to grasp that OP is also a tax payer given she works.

Pay tax on £900 a month income? Right.

Don't forget VAT

I don't know the ins and outs of it but maybe look at putting some into a pension pot? Does anyone know if that would be classed as depreciation of assets?

@JackyFrost

Cant you tell them you owe some money to someone and have to pay them back?

No. That would be fraud.

OP, Am I correct in saying that you dont want to spend this inheritance at all, but rather keep it as a little security for a time when you may need it? A little like a security blanket?
This is how your posts come across since you say that you neither want to spend it on living costs or a newer car.
I completely understand anyone wanting a nest egg as a security blanket, there if they need it, if that is indeed what you would prefer to do with your money.

@MiddlesexGirl I’ve said exactly that - don’t fritter the money, only spend it on stuff you are sure the benefits system will approve of. Research first.

Therefore not sure I understand why you’ve copied and pasted my post and then referred to bad suggestions that presumably others have made, as it may confuse the OP into thinking what I said was bad advice. I

I don’t think that’s what you mean though, or perhaps I’ve misunderstood.

All I can say is that I wish you all the luck in the world my dear. Money is so precious and when you have lived on a shoestring like you have, it is extra special. So be cautious and careful with it. Like a pp suggested, maybe learn something new to increase your income? Best of luck x

Is there anyway you could live in your Parent's house and rent some of it out so you could pay the other inheritor back? I feel like the security of half a house would be worth more to you than the £16K...

or could you and the other inheritor rent the house out? It seems a shame to lose the promise of a secure roof over your head...

I get it op. It’s shit that you don’t get to treat this money as a lovely nest egg, step up the property ladder or kitchen extension etc. All things that people able to work and earn a decent living wage would be able to do. The savings limit really does just keep those who are on low wages or unable to work due to disability poor. I’m not sure what the answer is but I do feel for you. Sometimes inherited money isn’t actually that ‘useful’’. Years ago a friend of mine had a situation where they were going to sue for a lot of damages, likely to win the case, had an expert lawyer (was a very specific situation but they suffered a massive injustice). This would have been covered by legal aid, then their parents died and they inherited money which meant they wouldn’t get the legal aid. They felt they couldn’t gamble the only amount of money they would ever have on a big legal case when they had dependents.

@Suzi888

I’ve worked in benefits OP. It’s true that £16k will take you over the threshold but you are allowed to spend it within reason, I don’t mean blowing it on parties. What would like to do with it? You can spend it on a car, household furnishings, any work that needs doing, a deposit on a house. Keep receipts. Obviously if you own a house you won’t get housing costs, just help with council tax. You can reapply once the savings drop a little under 16k, I’m not sure how UC class it, we called it ‘tariff income’. Ring UC /ask in your journal.

For the love of god take this advice. It’s not wasteful to buy items that will last long into the future. White goods, furniture, carpets. A decent car that will last many years.

Much better than dripping it into everyday living costs until you are under the threashold and have nothing to show for it at all.

@Vagessence

Fair enough but I can understand people being bitter, especially when the OP throws in remarks such as she doesn't know what to spend it on and only wants to work a certain number of hours.

@LadyFelsham "wants to work a certain amount of hours".. is that a joke? She has mental health problems. Jesus Christ I really don't understand the lack of understanding and compassion from some people.

How is it a joke. I'm quoting the OP, so unless she is joking!

I sympathise with the OP's mental health problems but I don't sympathise with what she feels to be a plight: upset that she will not receive benefits while having a substantial amount of money in the bank.

That's not an unreasonable position to take.

If you feel it is, are you declaring that her mental health issues means that she is exempt from having to use an inheritance?

I don't think those issues exempt her from having to use her inheritance instead of UC.

I don't think a lot of Mumsnetters will have much sympathy for you unfortunately OP. I got told I shouldn't have taken my kids on a £500 caravan holiday I paid for with the small amount of money (about £1000 after I'd paid for her funeral) I got when my mum died as I'm on benefits (single parent carer for my disabled son) We went to the place I went to as a kid to scatter her ashes. Not allowed though, if you're on benefits you're not allowed to spend any money unless it's on cheap food and bills.

I'd be in the same position if I were to get that sort of money. It wouldn't be enough for me to sort out housing where I live so it would be spent on living costs until it was gone.

I'm not sure what the answer is as obviously you can't have people with tons of savings claiming benefits.

Surely you could have waited until you actually have the money in the bank before closing any benefit claims? It can take ages for money to come through.

If the eventual amount puts you only just above the £16,000, hide the extra in cash somewhere. Or spend it.

I’m truly baffled that people think OP should be able to continue to claim benefits even though she doesn’t need them. Where do you draw the line? If she’d inherited a million but wanted to keep it for her kids’ future inheritance, would it still be OK to put it away and live day to day on benefits?

@Bagamoyo1

I’m truly baffled that people think OP should be able to continue to claim benefits even though she doesn’t need them. Where do you draw the line? If she’d inherited a million but wanted to keep it for her kids’ future inheritance, would it still be OK to put it away and live day to day on benefits?

I'm baffled too. In all the time I've read threads on mn I've rarely been so amazed.

Meant to say pension contributions are not viewed as deprivation of assets for UC (or tax credit claims). UC 100% disregard for any contributions entitled to tax relief (up to annual salary)
Here's the regulations
PART 6 CALCULATION OF CAPITAL AND INCOME CHAPTER 1
CAPITAL
(5) In calculating the amount of a person’s employed earnings in respect of an assessment period, there are to be deducted from the amount of general earnings or benefits specified in paragraphs (2) to (4)—

(a)any relievable pension contributions made by the person in that period;

I believe these are up to date regs, but you can get free advice from the Pension Advisory Service on this.

Once you go under 16k you will be entitled to benefits again

It’s ridiculous that the figure is so set in stone

I know others have mentioned it but the part but part rent scheme maybe a good idea even with bad credit

I know when you have always been broke the fear of going back there takes away the joy that being comfortable financially brings. But try to enjoy not being broke but be wise

OP - ignore the angry people. It's free money blah blah blah....and what do we call house prices going up, increasing your pension over the years, random tax loopholes that every mc uses but wc can't afford to, parents registering their house and assets to their kids once they hit 65 so they don't have to pay for inheritance tax or nursing homes etc. The entire British system is set up on free money for some and absolute misery for others.

Instead listen to people like: @seekingasimplelife, @JanewaysBun etc....

1. Check out the rules - what can you spend it on?

1. Put it in a pension if you can

1. Or an ISA for your kid - if you are allowed to do that.

1. A course?

1. Buy big expensive things that you would have to get anyway but cant right now e.g. car, therapy, white goods....etc

1. Think about whether your DC needs stuff in the future e.g. all kids grow so you could buy clothes for the next size up and the next size up after that etc...you get the drift

1. It's coming up to xmas - depending on what the age of DC but take them out or get them something.

16k isn't much but it's an ok cushion so you know that you and DC will be ok!! But dont just blow the other 10k on nothing - spend it wisely so that in practice you dont 'lose' the cash and dont have to come of UC for long.

And ignore the miserable people - they have no idea what true poverty and insecurity feels like.

"Spend some of the money on your house, new carpets, beds, decorating, then claim when you hit under 16k."

It's illegal to divest yourself of capital in order to be under the benefits limit.
Having said that, I think it's totally unfair that cash counts against you, but other assets don't. People who have expensive art and jewellery don't have to declare them.

For someone on a low income having that money in the bank is an opportunity that they will never usually have. If it has to go on topping up living costs it's a missed opportunity. If you are earning over £50K and have that money in the bank it's a completely different set of circumstances to what the OP is in. This kind of money may never come to them again and it may be the one chance to escape poverty so knowing it will have to go to top up a poor wage is heart breaking.

UC and other benefits should be in place regardless, especially for one off situations such as an inheritance. The person they have received it from will have paid taxes etc on the money already. In the long term it benefits everyone for people to have savings because this money will go back into fuelling the economy.

OP's question was is she unreasonable to be gutted? So no, YANBU. I work really long hours and am able to pay my mortgage etc out of that. Any inheritance I got would be extra, my employer wouldn't pay me less because I was lucky enough to inherit. In OP's position, it must be very frustrating.