Inheritance while on Universal Credit: what are my options?

[Stressedmum6761]

Hi everyone! 👋 I'm currently losing my marbles and need to speak to anyone who's been in the same boat.

My nanny passed away nearly 2 years ago now and it's taken a while for her things to be settled and sold etc. My family passed me a letter today addressed to me from my sweet, beautiful nan and a cheque for nearly £12K. I've been in absolute bits all day I keep bursting into tears. I've never had this much in my life and never ever expected anything from my nan at all and it's absolutely thrown me.

The thing is I know I should be absolutely THRILLED with this money, I'm on my own with DD who's 6 now. We've just moved into a council house 2 months ago and I'm on UC top up which also covers my rent, my job doesn't pay well but it's a school job and I get my holidays off with DD. I'm panicking more than anything because I know that as soon as I cash this cheque UC are going to deduct money each month (about £120 if my maths is correct).

My family said they know nan wanted me to put a deposit down on a house, which again I know if I get a mortgage my UC stops and I'm financially liable for the payments and any repairs etc if anything goes Pete Tong.

I'm thinking about just putting most of it in a LISA for now and potentially in the future buying a house...maybe a once in a lifetime holiday with the rest. I'm just torn because if I buy a house, I'll be so much worse off than I am now getting help from UC with rent payments etc. I've just moved into this house and started decorating and making it my own. I'm worried about the money sitting there and me being so scared to spend anything while also having money deducted from my monthly payments. Again, I'm absolutely ecstatic I've got this chunk of money for security but the fact that it's going to effect me whether I spend it or not is flapping me to the core.

What do I do? Has anyone had experience with coming into money while also being on benefits? Thank youuu from a very emotional and stressed mum.

IKR.
It's not like suggesting suggesting shelf stacking in a supermarket, or Deliveroo driver. Nothing against those jobs, but they do not require lots of skills and qualifications.

I know… what a ridiculous idea… take the £12k, keep it and get tax payers to keep subsidising you!

They will anyway because the cut off is £16k.

Well said! @ILoveAGingerCat👏🏻

@redhotsilly its not petti cash no. However its not enough for a house deposit. Its no where near retirement money nor would you say its life changing.

Exactly that doesn't mean she has to train to be a teacher just because she is a TA

Sometimes people get in these narrow thinking patterns on here and only see one thing maybe because there a the easy thing to type

There are plenty other jobs one can get trained up in that aren't teaching that pay more than a teacher's assistant but nobody is suggesting them

I think it's because the OP indicated that the teaching schedule means she can manage the school holidays etc. so it seemed like an obvious suggestion.

That’s incorrect. Under £6k - no reduction in UC between £6k and £16k - UC reduced, over £16k - no UC

That is what I said.

What about using the £12k for childcare for a couple of years, work full time with the goal to getting home - ownership levels of wage after the 24 months?

I was about to say the same as previous poster, why not use the savings to pay for childcare so you can train or get a job with more hours with the long term
view that it gives you more earning power in the future. Yeah, it’s frustrating having to use your inheritance to pay for childcare, but it’s an investment in your future. Id also think about investing some of the money in a stocks and shares isa for your daughter.

I definitely wouldn’t use it for a deposit, it wouldn’t go very far and you’ll have the stress of maintaining a property on a low wage.

You can go to school part-time from home

I was looking at how much we would need to earn to not receive a UC top up. We are 2 adults with two primary age kids renting in London. If I was working FT we would need wrap around care. Any guesses?

It was 100k 😆

Have you been a single parent whilst simultaneously training for a professional qualification and working to support yourself and your family?

I know this isn’t directed at me but yes, I have. It was very difficult but I made choices and sacrifices to do it. I’m not around for my DC for the full school holidays (and feel
guilty for that - hence me mentioning it in my previous posts) but I try my best to be present for them as much as possible and am trying to save for them to try to give them choices in their adult life. This is why it’s frustrating for me to see people in a position where their decisions to be at home for their DC through school holidays are subsidised but there’s also no effect when they also have significant (to most people) levels of cash too.

Where on earth did you get that information ? UC periodically review entitlement and will ask for claimant bank statements to do this - usually the last three months. They look at savings and any money you have coming in to the account to ensure your entitlement remains correct.

If you take out a loan and spend the money immediately it generally doesn’t count as capital but if you leave it sitting in the bank and it takes you over the savings threshold by the end of the assessment period, it will reduce/stop UC.

Cash gifts such as birthday or Xmas gifts or one off sums generally won’t be treated as income but if a cash gift takes you over the savings threshold then the normal deductions apply. While these occasional gifts are ignored as income, receiving structured or regular payments will likely trigger a closer review - they may be treated as regular income and UC reduced accordingly. The sums of money suggested by the poster l was replying to would warrant a closer look, and could potentially take OP over the thresholds.

l have no idea why you think UC don’t care if you have wages coming in, as topping up earnings is one of the main functions of the benefit. If you’re working you declare your wage at the end of each assessment period on your online journal and the amount of UC is calculated according to your earnings.

And UC absolutely do care what you spend your money on. If you deliberately spend money on non essentials or luxuries to get below the thresholds it’s classed as deprivation of capital and you are treated as though you still have the money.

May I ask what you did?
You were working full time, training for a professional qualification and caring for your home and family alone?
What age were your children ie what level of childcare did they need?

I admit I don’t know how it works, so can you share the sums you did to get to that figure?
Do UC pay all your rent?

I don’t understand this. When young couples are struggling to get on the housing ladder and when the job market is really tough, what sort of “working full time” role do you think a current TA would do to save enough for a deposit and then fund a mortgage on her own with a dependent young child?

I don’t understand. Surely you realise you only receive benefits to support you if you don’t have money so now that you do, you don’t need and thus shouldn’t get (as much) benefits?

or are you suggesting ~other people ie taxpayers should continue to pay for you you should still get UC and be allowed to keep this money? I appreciate the source of it is sentimental but that’s irrelevant.

It'll take a long time don't get me wrong but I would see it as the one chance to get out of the position OP has found herself in.

Maybe in 5 or 6 years there will be a deposit ready to go and mortgage will be more manageable

But you also suggested I use the 12K on childcare? I can't use that money and then also after 5 or 6 years have a house deposit ready to go surely?

OP will be allowed to keep £6k without it affecting benefit. She’s recently been given a council house and DWP will allow her to buy essentials - furniture, etc without it affecting her entitlement. She also has a car loan, overdraft and credit card debt amounting to £2.5k which they will likely allow her to pay off as it’s essential expenditure to reduce her outgoings. So that pretty much much takes care of most of it.

Benefit claimants are allowed savings and there are various thresholds above which deductions are made from UC. It’s not financially savvy to keep claimants without a penny in the bank because they are then reliant on the state for every life event. Might interest you to know that the thresholds were set in 2006 and haven’t been reviewed since, despite several studies advising that a realistic savings cushion minimum would now be around £12k.

sigh I'm absolutely not going to answer yet another one of these. Not once have I:

1. Said I want to receive or expect to receive the full whack of benefits while having this money
2. Tried to ask for a way to HIDE the money
3. As others have said, unfortunately I will still be entitled to UC until I'm over £16K

This post was to ask anyone for advice and if anyone has been in the same boat. Since then I have received actual helpful advice from people who have bothered to read or actually think about what they have read. Please kindly read a post properly before getting on the benefit bashing brigade. Thank you 😊

If you don't understand, why don't you read the thread, or Google, to see that anyone with savings up to £16k is entitled to UC. This is the threshold that the government have set. There are teachers, nurses and other professionals who receive it, particularly those who are privately renting. A pp said her and her husband would continue to get UC in London up until their combined income is £100k. This is not people taking the piss out of taxpayers (many on UC will be paying tax themselves), it has been decided by the government.