Savings in my name stopping Universal Credit despite low income

[slowingdown1]

can anyone more financially savvy than me help?
Recently divorced, ex DH pays minimum child maintenance. Have a low
income due to home working in low demand role so I can care
for 2 x disabled children. Yearly
salary is £31k before tax, I save £100 monthly into pension. I claim Scottish disability payments for both kids which go on private treatment / therapies. Each month I scrap by and have a constant low credit card debt despite my best efforts. I have savings that were gifted to me by my mum as long-term financial security of £80k. Although the money is legally in my name, I have made a firm promise to her that I will not use it, so morally I do not feel able to touch it until she is no longer with us.
My current income is low, but because these savings are in my name, they are preventing me from applying for Universal Credit as above
the threshold.
I understand I can’t eg transfer the savings into trusts for my kids as this would constitute deprivation of capital. I can’t ask my mum to eg take it back for the same reason.

It sounds like you might as well use the money now. As you say, you're in a "catch 22" situation.

Consider making a lump sum payment into your pension. I believe you can pay in up to the equivalent of 100% of income per year. If you do that in 2 consecutive years that will use up most of it. Put £6k into an ISA. That will leave you with £10k to top up up your income for the following year or two. After that, when the £10k is spent, you might be eligible to claim UC to top up your income.

Your mother will have to accept that the money stopped being hers from the point when she gave it to you.

He seemed to be saying if it looks like you are deliberately running down savings tsjtd
not allowed and that’s why it’s a catch -22.

Thank you, I didn’t know this about the pension.

I assume the money was moved to avoid care costs?

Really appreciate the helpful replies, I’ll go back and speak to them about the pension idea and check that would be allowed. Thank you.

Paying off a debt (e.g mortgage) is not regarded as deprivation of assets.

Come on folks. The OP doesn’t want to fritter away her money on living expenses. Let’s have a whip round to help her out so she doesn’t have to eat into her £80k savings 🤣🤣

Ooh that’s so unfair. As a tax payer I should be supporting you so you don’t spend your significant savings.
I don’t think so.

No I don’t think so, she just gifted it when she got her diagnosis saying she wanted me to have money aside so I would always afford care and therapies for my kids without worrying about those bills.

You can use the £80k you have in the bank to make ends meet. Why should others, many of whom earn less than you and have no savings, subsidise you?

Thank you, I must have misunderstood the advisor, that’s really helpful.

The advisor seems to be regarding someone needing to claim UC as a freeloader....ah ha....look at you spending all your money so you can get UC!
If you're spending that money on supporting yourself and family you're not frittering it away, you're living.
I think you need a second opinion,

It's bad advice.
The bloke from CAB meant this sort of spending when he was advising you.
Using your 'savings' to live on is not deprivation of assets because you won't be claiming UC, because you won't qualify.
If you blow it on pension top ups of mortgage pay down they will probably certainly view it as deprivation of assets.

Kindly I’m wondering how are you making up the £1750 shortfall currently? It sounds very difficult if your kids need this amount to meet their needs. Surely UC will not award £1750 above current salary and benefits unless you are spending large amounts on specialist childcare (to work I’m assuming) and care/ respite/ therapies.

Or are the kids not currently receiving what they need. Genuinely curious as £1750 is a lot of UC and clearly your children are very high needs to qualify for this level of funding and it must be very difficult for you all currently if you are struggling to pay or they are going without. I don’t believe a working parent would receive that amount a month without evidence of high needs.

You have my sympathy OP.

Over paying is.

100%

Exactly! I have savings I don’t want to use. GUESS WHAT?

It is incredibly difficult yes, and I’m not making ends meet hence my credit card debt. Both children have complex, life long care needs and sadly therapies are expensive, as is the care I pay for while I am working. Not a moan, just a fact. Managed ok when married but one income I can’t.

I'm glad your brother is nice.

I think he's probably right.

CAB can be good, but they can also be spectacularly crap. I wouldn't take one advice as word as gospel..

In your situation, I think I would pay it off the Mortgage, yes it's not quite what you agreed with your mum because she wanted you to wait until she died to spend the money but given that paying off the mortgagee is not at all a frivolous waste of money & that your situation is completely different to what it was when she gave you the money. I think you are still achieving what she wanted for you, even if it's not exactly what you discussed. In this way, you are still ensuring the children's care which is what she really wanted for you.

before you pay it all off on the Mortgage have a think about what would make your life easier or better day-to-day & do that first.

So if that's a more reliable car, or a few things around the house that would really help like a dishwasher, or making the bathroom into a wet room (not knowing your children's needs) do those smaller things that would make life better and then pay the rest of the Mortgage.

I understand how hard it is to spend that lump sum and not having it sitting there in case of a need. But it sounds like you would be better off doing that.

Well I didn't say that, did I?

Thank you so much, that’s incredibly helpful. Funnily enough a wet room is on my dream wish list! Currently have a hoist over the bath but still requires significant heavy lifting and often needs reset/ repaired.

If you use it to pay off your mortgage or increase your mortgage payments then you wouldn't need UC surely?

If your Mother gifted that money to you, knowing she might need care then it's her that will be looked at with regards to deprivation of assets. They'll go through her accounts with a fine toothed comb if she says she has no money to pay for her care.

I think you need to be a little bit careful and keep your own council,

I wonder if any of the posters stating this is definitely not deprivation of assets would be able to point you in the direction of something to confirm this??

The OP had said that her brother is going to pay for care if her mother needs that. Good for him - my DF's nursing home costs £80k a year.