'Excess' money when on UC

[170Biscuits]

Hi All, I'm new to UC and I don't want to come off as crass as I know my sitution isn't many people's reality but wondered if anyone could give me advice?

-I'm a single mum, on UC, gave up work a couple of months ago as my son's condition and care needs deteriated and became life limiting, he receives DLA both parts at higher rate.

-My outgoings are very small, I've already overpaid my mortgage as much as it allows and it is now a very low monthly amount (£140ish), my dad is a chef so our food bill is tiny as we get alot of leftovers and unused ingredients delievered daily. Although we do lots as a family it's generally free/cheap like parks and museums as it's accessible and they are only young; we haven't ever gone on holiday due to the youngest's needs. I've always grown up being frugal so all clothes and toys are second hand. The only larger than average expense we have is fuel due to high heating costs.

-My income from UC is more then I'm regularly spending, is there anything I can do with it other than increase (what feels like to me) more 'frivolous' spending. Again just to clarify I am not judging other's spending or calling it frivolous, it's just not been my typical spending and we haven't needed to have larger expenses. I was wondering about setting up a private pension- it was hard to find information on but my understanding is the most I can put in is £2,880 per year?

Other than a pension is there anything else productive I could do with it without saving it and going over the £6,000-£16,000 limit? Would I be limited to £2,880 annually putting into a private pension?

I think savings accounts in your child's name which you cannot access to withdraw from would be ok.

I think private pension is a sensible option.

Are there home improvements you could make to improve the quality of life for you and ds?

You really don't know what's coming down the line with disabilities. I'd be more inclined to put it in a higher rate savings account where you can get at it if anything goes pear shaped.

In the short term anyway.

Does being on UC count towards state pension entitlement?

If not, or if you have other missing / part completed years you can top up your national insurance contributions. You can see online via your government gateway. Then it is a matter of 2 phonecalls to sort it out.

Thanks all for you speedy replies

@RaininSummer thanks, yes that's reminded me to do it. I will set one up for my daughter, I don't think it's wise for my son as although I hope he's here at 18 those types of accounts e.g. junior ISAs require parents to become deputies if they lack capacity (the same as the issues with child trust funds which has been in the news).

@BernadetteRostankowskiWolowitz thanks, I will explore private pensions. I'm not sure home improvement wise but will have a think

@AgnesX the issue is that my UC will be stopped if I have more than £16,000 savings and I recently got council tax benefit removed (it was due to be about £800 per year) as I tipped to over £8,000 a year savings

@TeenDivided I'm not sure if UC counts towards NI credits but child benefit does so I'm fine there. I do have 3 years of missed credits but am well on track to be fine state pension wise so I'm not too worried. Thank you for the ideas and checking it though

If you're on UC then you'll be credited with Class 3 NI Contributions. These cover the State Pension but nothing else.

Quite a few folks are eligible for both UC and one of the benefits like NS ESA/JSA or Carers. UC is reduced £/£ for those benefits so on face you might as well just have the UC.

However they credit Class 1 NICs which can give you extra options in a change of circs. Being paid fortnightly helps some people too as they find it easier to manage their cashflow.

Does DS need any equipment/adaptations that aren’t funded? Or a better spec than would be funded? Or equipment/adaptations that would improve DS’s and your quality of life even if it isn’t strictly necessary?

@Bromptotoo Thanks for the heads up about the different classes I could claim carers allowance but didn't bother because I wouldn't be better off with it being offset against UC, but reading more about it now I will look at applying

@OvertakenByLego in terms of adaptations and equipment he's only got his wheelchair, standing frame and specialist seating, he's only 4 so in lifting him and he's in a regular car seat.

I'd love to purchase some 'big' or special toys for him but he just isn't interested or able to play with things despite lots of trying and nursery working with him loads on it. He hasn't played with a single toy the whole year he's been there, he just bats things and people away with his arm; ive bought him lots of toys and sensory equipment to try but he just can't tollerate them. He loves music so I might look at booking some experiences like (toddler friendly) shows and know that if we leave after 5 mins it was worth a try and not to feel guilty about any money lost.

i think what you need to do is think what would help dc longer term. Off the top of my head, swimming lessons, music therapy, adapted bike, holidays, speech therapy, orthotics, iPad, projector, days out. There ARE long term benefits to enriching dcs life. Those who struggle more really benefit from extra.

You don’t mention your age but if you are under 40, you have 30 years+ to build up your pension.
£2880 (£3600 with tax relief) over 30 years at say 5% growth gives you £250000.

I could kick myself for not starting earlier, I started with a Sipp 5 years ago and have almost £30k. That’s with £2880 a year going in and a very small transfer from an old council pension.

Private pension is a good idea.

Holidays? It may cost extra to be accessible and comfortable for your son (although many places are very accommodating). I’d go on a blowout trip to Florida but accept that may not be possible.

Equipment, clubs, treatments, excursions, classes your son will enjoy? Or something independent for your daughter - I think there’s some holiday clubs and similar for children who have disabled family members she may get a lot out of.

Other than getting whatever your children need could you buy bits of gold (literal physical gold) and if times are not so good in the future you can sell it in bits too e.g. a gold sovereign.

It's probably not in the spirit of benefits but as you would be within your rights to spend it on booze or fags if you chose then why not.

Firstly, anyone who judges you in your situation is an absolute *t I'm sure you'd swop all the money for a healthy child.

I agree that pension payments to help towards your future would be a good idea. Any anything that can make your life a bit easier and make your son's life better.

@BorgQueen that's encouraging to hear, I'm early thirties and from reading online it ready felt like I was starting late. I do have an old work pension whixh i contributed to for thr last 8ish years but don't think it was very good, I never paid much attention to it which I now regret. I suppose all this has made me look to the future more. I will look at a SIPP.

@PinkFrogss thanks, those are lovely suggestions, DD6 started martial arts club at Easter and loves it (it wouldn't of been my choice but glad she gets to do something she enjoys and I'm proud of her for choosing something she wanted rather than going with the crowd).

DS has a (non cancerous) brain tumour and as well as his general functioning his behavior is hugely affected by it due to the trauma in the brain. The thought of getting through a plane journey with him is enough to male me need a lie down! He is only small and non-mobile but very aggressive all day everyday. I've been mulling over trying Gullivers world for a while and I think the posters in this thread have been helpful, I will rope in some adults to help me and take them both, if we only last an hour and try one thing at least it's an experience. DD would love the rides, DS may like some gentle ones, but I def think he would enjoy the busy atmosphere and music etc.

In that case, there are loads of things you could use the money for. For example,

• If you spend a lot of time outdoors you could look at a SN buggy or off road wheelchair that will be far easier to use on different surfaces. You can even get things like beach wheels or even a wheelchair that can go in the sea.
• An adapted bike/tricycle or a bike for you that DS’s wheelchair can go on or a SN bike trailer.
• If you bathe and changing DS, a rise and fall bath and changing table. Or a wash and dry toilet or profiling bed, if appropriate.
• Additional specialist seating. What is DS using at the moment?
• Other equipment that could help w.g. Innowalk.
• hydroptherapy pool.
• Music therapy.
• Could your garden be more DS friendly? Does DS use any equipment at the park?

Some of the above may not be appropriate and some may be able to be funded via other routes, but I hope they give you some ideas.

There are some lovely accessible holiday homes in the UK. You could look at a holiday there if you are concerned about going abroad.

Agree 100% with @OvertakenByLego

We are in a similar situation, been paying for ‘luxury’ things like private physio and hydro for my child - it’s hard to tell as she doesn’t have a diagnosis, but pretty sure it’s been a very very good investment for her future health.

Deposits on WAVS have gone through the roof recently, so you may find that wipes out savings if you have to go down that route one day (totally recommend by the way, a million times safer and easier than lifting into car seats)

Also if you need hoist in future and they only suggest single track, paying extra for H track is worth its weight in gold

We also used some of my savings to buy a power pack to convert NHS wheelchair into an electric one

All of above make life a lot safer and easier for everyone and, I feel are good ‘investments’

Just curious here - but wouldn't paying into a private pension be considered the same as saving 16000 pounds? Surely because it demonstrates that you don't need the money for living expenses? I didn't think that would be permitted or am I wrong?

Pensions are not classed as savings under the rules.

Amazing how many people don’t know about the savings limit! Maybe a holiday for you and your DS? There are accessible ones available and it sounds like you deserve it. Pension sounds good too.

If your son would like to go places such as the beach (or you/your daughter would and your son will cope with it) you could get a (wheel chair adapted?) camper van on a finance agreement paying it off monthly.

Is your old pension a Direct benefit one ( they pay an income at retirement, there isn’t a ‘pot’ as such)
or a Direct contribution one , it’s a pot of cash that is either invested in a default fund or you choose investments.
If it’s DC, check the charges you are paying, they may be lower or higher than what you can get in a Sipp. Anything under 0.5% a year is reasonable. I pay 0.35% with Hargreaves Lansdown + 0.2% or less for my chosen funds.