what on earth to do with inheritence?

[marymaryquitecontraryusedtobeafairy]

I've been left a house which to sell now would bring me about 80K in the bank.

I'm poor. I bring in about 24K/year, and am in masses of debt. I just survive. I'm a mum and I work and get benefit top ups. I'm council housed in a dire part of the country, the house is in a slightly better area but I don't wish to uproot myself and children from school and home.

What do I do? Can this help me get out of the poverty trap? Do I live off the money? Live in the house and enjoy a secure home but remain in poverty? I can't afford to do the house up but can I possibly buy a very cheap or auction place, do that up and start flipping houses as my main income?

Look I'm not that bright but I've worked hard all my life and it's just not good enough financially. I decided to be a care worker because I enjoy it but the pay alongside the increase in prices has crippled me and there's no way to get out of it so I just trudge on day by day. I'm not miserable nor are my children but I don't want to waste this opportunity.

I don't have money for a financial advisor right now nor time to research so I'm hoping you clever and wealthy lot can help me out a bit with pointing me in the right direction.

Thank you.

Can people stop recommending op becomes a Landlord.... Just don't.

I am not a legal or financial expert. Just a thought though: Were you left this in a will? If so it is possible to amend the will as a beneficiary so the money goes directly to your children. Called a deed of variation I think. If that's what you want.

Renting out a home is not easy. it needs to be up to safety standards, there are annual costs involved with updating certificates, she would be responsible for any repairs, so if a boiler breaks she would suddenly have to find that cost of replacement at short notice, tenants can stop paying rent, they can damage the place, she would need to pay a management company and landlord insurance. I don't think she is in the financial position to take that on.

This won't work for OP. She is on Universal Credit so she can't just have 6n months living costs in a rainy day fund because she will lose benefits and be expected to live on the money she has until it is almost all used up. She will still be in the same position a coiple of years down the line as she is now. Living in a dire area back on benefits to top up her income with no realistic way to escape.

You should see a financial advisor. i know you said you cannot afford it, but you really need to find a way. you are far more likely to be able to make something of this opportunity with professional advice. if you are not experienced with money, you are highly likely to blow this chance.

also the best thing to do is so dependant on your exact circumstances, which is impossible to describe in enough detail on a web forum, but which you can discuss in more detail with a professional.

personally i would not move into the house, an owned home is a liabiity not an asset, it will end up costing you, the rent paid to live in council housing is a cheap way to live, so id either sell it or rent it out. also make sure you dont lose your benefits.

Could you buy your council house? If you don't like the area you can always move later on when you're earning more or the children move out but doing that gives you equity in a property rather than having to live off the 80k until it's gone.

Can you get a survey done on the inherited house? To see if there are any upcoming massive expenses I mean. Unless it's had a new roof/boiler that sort of thing in the last few years.

I think I'd do that before deciding to move in or sell it.

Surely benefits will only cover the rent of the council house while the children are at school, then you may have to find somewhere smaller and/or top up the rent.
The chance to live in a home mortgage free for me would outweigh moving schools (unless GCSE year). Minimal legal fees and the non-rent element of your benefit should remain unchanged.

Also regarding career, have a look at NHS jobs. Band 3 is similar pay to what you're on now, and there are loads of opportunities for development/progression.

Op to stay out of trouble and not have repercussions you need to look up the DWP deprivation of assets rules - this will explain to you what is considered acceptable spending of the money ( should you decide to sell the property ), and what is not. Things like clearing debts, buying a reasonable second hand car, replacing worn furniture are all acceptable. Things like giving money away, setting up savings for your kids etc are considered deprivation of capital and if you get rid of money this way you can be treated as if you still have the money, so you do need to be careful.
Speak to CAB about how your UC may be affected if you were to live in the house. you would lose the rent element on your Uc claim but would get a higher work allowance ( the amount they disregard from earnings before deductions take place ) so may only get slightly less in benefits. You think all your rent is covered but it really isn't at the moment because your earnings are reducing your whole UC award including your rent element. Fast forward a few years to when your kids are no longer on your Uc claim - you likely won't get any UC on earnings of 23k so to live in a rent and mortgage free property would benefit you hugely in the long run.

Yes once op has no dependents she won't get UC at all ( or very little )on earnings of 23k. I may have missed how old the kids are but if teenagers this will soon come around.

With the OP being in so much debt, it’s highly unlikely that she’ll get a mortgage, while an investment opportunity like this is good on paper, I don’t think the OP would benefit from it because of the position she’s already in.

Regarding looking for work, there is a lot of free support out there. Look up the National Careers Service, you can speak to an adviser for free over the phone and they'll have people in your area to help also. There is a lot of funding available for retraining but you need to think about what's important to you, and what you want to achieve. A qualified careers adviser will help you to identify these things. Good luck!

nationalcareers.service.gov.uk

Don't do this. Spending the difference would be viewed as depravation of assests and likely to land OP in a whole heap of messs with her benefits. Even clearing the debts in one go can be looked at as depravation of assets.

I would rent it out.Then start to save up a good pot of the money in order to free up your debt.In the long term your house will go up in value,eventually your debt will be gone and you will still be getting the rent in.

Is the house reasonably sound? Wont need a new roof next year, rewire, new heating system?

If it is sound or as sound as any house can be, move into it. A less desirable owned roof over your head is much preferable to a rented house.
Ok itll need work, so slowly do the work. Theres no rush. You will still receive some benefits less the rental part. You can slowly pay off the debt, or if next to nothing needs doing on the house, quickly pay the debt.

This is what I would do. I'd rather own my house than be at the vagaries of landlords, even council housing can change rules.

FWIW I've lived in many a renovation house, yes its shit and sometimes seems to go on forever, but its worth it in the end.

I know the struggle of care home wages. Would you consider doing the NVQs to go up the management ladder? See, 40 was the perfect age for nurse training and sadly now, who wants to be a nurse in this climate? I will say though, soon enough it'll be only nurses who'll be able to administer botox etc, so that could be a side hustle for you if you do that.

If you uproot to this house, how would the kids feel?
Also you're still entitled to uc and once you're in the house as a low earner there's plenty of schemes to replace boilers etc and then just have a decent insurance cover with British gas or homesense.
Get a free bit of debt advice, depending how broke you are a debt relief order or debt management plan or something?
With this climate, owning a property with no mortgage is an absolute gift.
Once your kids are out of education you're entitlements for UC support drop drastically and if you can own a property then you'd be crazy to not do so, landlords are selling up, the HA are almost impossible to get a house with and it's a very uncertain time.

Depending on where you live, could you sell this property, ring your debt people ask what they'd accept as minimum repayment to close the debt and with the rest consider buying something else?
I'd probably be able to get something where I live for 60k at a push, but the solicitors fees and EA fees are also high.

Good luck, and I'm glad you have this opportunity. Even if you sell up, pay debts and give your kids decent savings, it's a wonderful gift!

Lots of daft advice here. You can only have 6k in savings before it affects benefit payments - see https://commonslibrary.parliament.uk/how-savings-can-affect-benefits THE LIMIT IS NOT £16k.

Note that the income they assume is about £50 per year for each £250 in savings - you cant get that in saving income, you'd get maybe £13. so even 6k gradually gets wittled away.

If you moved into your house insurance would be advisable but is not compulsory. For an £80 house and limited possessions you might pay £10 -£15 a month. If it burns down you are back where you started. Other costs can be minimal and if the boiler breaks you secure a loan against the house at a lower interest rate. In my area if you moved and explained your position you'd get lots of help from locals with e.g. furniture if needed.

You should be able to get a job in the new location even if it's not close enough to keep your current job.

If you have maths and english at O level lots of jobs are open to you.

Sorry that should be the £16 is wittled away - until it gets to 6k.

If the house is worth only £80k surely it will need work and there won't be rooms aplenty to let out, people are posting as though its a great opportunity, if it was that good surely people with savings would be snapping up these £80k houses to do the same if they didn't need loads of extra outlay.

Op would lose £4.35 of UC per month for every £250 above 6k, so around £17 a month for every 1k above 6k and up to 16k when UC would cease altogether.

can I possibly buy a very cheap or auction place, do that up and start flipping houses as my main income?

I think this takes a certain skill set, knowing the right trades, building regs etc and generally needs decent capital upfront. If the house you've inherited can be done up a bit it may fetch more than the £80K without too much outlay - people want a blank canvas, clean, fresh paint etc but if it needs new kitchen, bathroom, roof,rewire, boiler it all adds up.

It's important to clear your debts but I'd be tempted to move into the house. You can improve it over the coming years, it shouldn't decease in value and you may never get the chance to own your own home again. If your kids are young they'll adjust. The big 'but' is about how this affects UC, income etc and you may need to sit down with a financial advisor to work all that out. Sometimes a temporary sacrifice leads to a longer term gain.

Don't sell it. Think of the long game. Hold onto the house for now, rent it out until your debts are paid off. You could get your debts paid off in about 4/5 years with the income from the rent. İs it in an area which you could do air BnB with it and get more than 500 a month? Eventually when you're in a better financial position you could get a mortgage for right to buy for your current council place and use the inherited house as guarantee for the mortgage. You can get things like boiler repair insurance to rent out the inherited place. İt will take time but eventually you'll have 80k in assets, as well as the assets for the discount on the council home (I think it's up to 80k) and whatever you've paid off on your mortgage. After your children leave home you could sell both, buy a small flat and put the leftover into savings and you'll be working full time in a better role by then.