AIBU to worry I will never be able to use inheritance money?

[WanderingStar26]

An inheritance one, kind of.

I am a single parent, I have a disability which limits how much I can work, I live in a HA house, my youngest child is 16 and going to college in September.

I’ve been aware of the fact that I have had the buffer of UC for years, as well as working PT, but that will be coming to an end (or at least massively reducing) when my youngest finishes education. I have been really trying to up my earnings (I’m self employed), and I’m doing better than I was but it’s difficult health-wise, and I’m definitely not going to be able to get a mortgage anytime soon.

Today my DF announced that he was selling one of his properties and splitting the money between his 4 DC. My three siblings all own their own properties, so that’s really handy for them as they can pay off a chunk of their mortgages. The stipulation to this money is that it can ONLY be used for property, so if I can’t buy then I won’t get it, basically.

It’s very generous of him but realistically I’m not sure how I will ever be able to make use of the money? I repeat, he will not let me have it unless it’s going towards a property purchase. Which is fair enough I guess as he doesn’t want to see it wasted. But I don’t see a realistic chance of me buying a property, ever, sadly, much as I’d love to.

He said he will put my share in an account and when I need it I can have it. But I’m mid forties now, my health seems to be going downhill and despite me really doing my best, my income isn’t ever going to be at a point where I can get a mortgage.

I’m not sure what to suggest? Maybe ask him to put it in a trust so it might benefit my DCs in future? I’m just worried that if it sits in a random account then eventually I might have problems retrieving it from the wicked stepmother (a whole other thread), and best case scenario will end up losing a chunk of it to inheritance tax. My DF is 73.

Ask him to keep it in an account and gift to your younger child so she can get on the property ladder when she’s ready.

If he puts the money into a trust either for you or your kids it doesnt affect your uc. He could even specifiy that the money in the trust was only used for housing or whatever he wanted.

I think you need to ask certain how much your share of the rental income on the commercial property would be, then you will know if, at the time of you receiving that it would provide you with enough income for a mortgage.

"Wonderful. It can sit there rotting away so you feel like Lord Muck doling out pennies where in reality you're only helping your financially settled children"

And go low contact.

Also think your dad sounds like a knob end, sorry OP. Is he getting some strange kind of kick about being awkward and saying no to perfectly reasonable things? Could you tell him to just give your share to one of your siblings and then you can later come to an agreement with them about how you could use the money without knob end dad ever knowing or being involved?

Once your DC is working, you could use it buy a flat in his/her name and the rental income pay the mortgage. You’ve then given them an investment property for life or to even live in if they can afford the monthly repayment.

If your dad agreed, you could set up a lifetime isa for your DC in the meantime which allows you to put in £4k a year (obvs from inheritance stash) and the government adds 25%. The rest could be put in a stocks and shares isa yearly too for your DC (good returns if held for 5+ years) The lifetime isa only allows it to be withdrawn for buying a property.

This at least means the money is now with you and DC rather than an account you have no access to and you’ll be setting your DC with an investment or place to live for life.

Part but, part rent. Then you’ve invested your money in the property, your benefits will continue to pay your rent and you have more security than you do now.

I would ask him if it can be used for your child’s benefit instead.
Your child is 16.
2 grand intensive driving course, 2 grand insurance, 3 grand first car.
(These are my figures for my 17 year old who has just passed).
Then 4 grand a year into a LISA for your child once they are 18 that they can either use for a house deposit in the future (although you said they probably won’t be buying a house- not sure why but I’m sure there is a reason. It could stay in the Lisa for a pension for your child in the future. Or, I know he said only a house deposit but would he put even a small amount into a Lisa for you to make your retirement more comfortable.
If your child goes to uni - uni fees.
If they do an apprenticeship or trade the cost of that. (My older son joined the RAF and the kit we had to buy was about £300. It was things for basic training and polish and other random items from a list.)
So if I was you I would explain your situation to your dad but really push that you desperately need the money for your child.

Other than that could you do a part buy part rent? Near me there is a scene for a 1 bed flat. It’s £80,000 for the bit you buy then you rent the rest. So that may be doable. Then your son has a sofa bed in the living room. Not ideal but may get you on the ladder.

You can pay money into a SIPP for yourself and/or the children if he would allow that. No issues with UC with that as long as he did it directly not via your bank accounts first.

Although it might be taxed or affect benefits when retired it would hugely increase your security - who knows what pension and benefit sotuation will be by then.

Buying land or other similar things might be seen as capital by UC so you'd want to check that.

Have you used benefit checkers to see what your situation will be after children age out?

I can’t get past the fact that OP’s father owns multiple properties and doesn’t give one to OP. I cannot imagine having such excess whilst one of my dc has no property ownership.

Can he put it in a/your pension for you.

I think a lot of parents are very cynical/cross about benefits, and if you are your son are likely to be dependent on them, it might be that he wants to try and change this by forcing you into getting a mortgage.

Part of me can understand that.

If your son is also likely to be unable to work, would buying a house help him also? If you sold it to your dad as a multi-generational investment (for example if you could part-buy with him or some other scheme) would that help? Or make things worse?

He can hardly give a rent-free property to one child and not the others! Imagine how that would land.

I can see it from your DF point of view. He has a chunk of money for each of his children. The others will put it into their properties so it becomes a lasting legacy.

You on the other hand will simply put it towards living which will in turn reduce your benefits. He will basically be taking over the burden for a short period and then it will be gone. From his perspective he will be asking "what is the point?".

Is there any way it could be put into house deposit isa or start off a pension fund for your dc instead.

I think its fair for him to put stipulations on things but i dont think you/dc should miss out on life changing money if it can be used in an alternative way

For me some of the suggestions seem overly complex for the amount of money involved and risk incurring costs.

He seems to be the kind of person that sees property ownership as the way to wealth. That doesn’t work for people in your situation. You should think very carefully about giving up secure social housing in your situation. That’s why shared ownership could be a good option. Security of tenure but still access to housing support for rent.

my choices would be

1). Shared ownership. HA still owns the building so you don’t have the risk of buying a property outright youself. You can still qualify for housing support on the rental element.

2). The idea of supporting your child with costs such as driving lessons is also a good one but as he says it’s for property only I guess that won’t work

unfortunately it’s not as easy as that. The sibling would have to show the mortgage lender then could afford to run both homes and then there would second home owner stamp duty to pay at 5%

I’ve got money aside that I intended my dd to use to buy a house. She’s in a similar situation to you and now I’ve given my head a wobble I’ve decided she can have it to use in any way that makes her life easier. Maybe try and explain to your dad the concept of equity. He’s being closed minded and ableist, which is a bit disappointing and sad. It’s no doubt generational

Do you like your current home? No point moving if you do.

With shared ownership would it be enough to buy a share outright and get the rent element down to your local housing allowance?

Otherwise I think the pension option or gifting to your kids would be a good idea. Maybe check on money saving expert through as I have heard that having a small pension could make you worse off overall than no pension in terms of pension credit and associated benefits.

mortgage companies will take your universal credit income towards your affordability assessment.

there are calculators online you can use or I am a mortgage broker so if you feel comfortable you can PM me and I can get you an idea of what you may be able to borrow

OP says in one of her replies that shared ownership isn’t an option.

Sorry I missed that. Did the Op say she can’t do SO because she can’t get a mortgage. My thought was she could buy a % share outright with the money from her dad and pay rent on the rest. So no mortgage needed. I did this once myself with a HA flat.

There are limits to this though. The max that can be contributed is 100% of the recipients earnings (up to £60k) or £3600 for those who don’t work.

Buy a shared ownership, then UC still pay the rent aspect

I’m not sure if this has already been suggested but shared ownership could be an option? That’s what I would choose.

Reposting this.