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  • FIRST POST
    • MikeJO
    • By MikeJO 15th Jul 17, 5:52 PM
    • 318Posts
    • 277Thanks
    MikeJO
    Inheritance while on benefits
    • #1
    • 15th Jul 17, 5:52 PM
    Inheritance while on benefits 15th Jul 17 at 5:52 PM
    Not sure if this is the right place to post this as it covers more than one area but here goes.
    My mum died earlier in the year so I'm soon to come into an inheritance of just under £100,000. However my wife and I currently live on benefits (have done for about fifteen years) due to her disability; realise that as soon as the money comes through we'll lose Income Support and Housing Benefit (we rent privately) which amounts to about £1100pm so the capital will dwindle fairly quickly over the next six or seven years.
    My question is what is the best place to put the bulk of the money to get the best return over those years? Savings account interest rates are so dismal at the moment I just wondered if there was a better alternative. Any advice appreciated.
    Procrastination is my middle name....well it would be if I could be ar**d to contact Deed Poll."
Page 1
    • Keep pedalling
    • By Keep pedalling 15th Jul 17, 5:57 PM
    • 3,431 Posts
    • 3,702 Thanks
    Keep pedalling
    • #2
    • 15th Jul 17, 5:57 PM
    • #2
    • 15th Jul 17, 5:57 PM
    What are property prices like in your area?
    • Torry Quine
    • By Torry Quine 15th Jul 17, 5:59 PM
    • 16,895 Posts
    • 25,757 Thanks
    Torry Quine
    • #3
    • 15th Jul 17, 5:59 PM
    • #3
    • 15th Jul 17, 5:59 PM
    I don't know the answer but just wanted to say your post was a breath of fresh air. You aren't trying to retain your benefits with a large inheritance.
    Life is like riding a bicycle, to keep your balance you must keep moving . Albert Einstein.

    I can bear pain myself, he said softly, but I couldna bear yours. That would take more strength than I have -
    Diana Gabaldon, Outlander
    • MikeJO
    • By MikeJO 15th Jul 17, 6:03 PM
    • 318 Posts
    • 277 Thanks
    MikeJO
    • #4
    • 15th Jul 17, 6:03 PM
    • #4
    • 15th Jul 17, 6:03 PM
    What are property prices like in your area?
    Originally posted by Keep pedalling
    Not an option sadly, we live in Devon and there's really nothing in our range. I appreciate there are areas of the country where buying a property would be an option but given my wife's health there's no way we could relocate away from all our family and her support network.
    Procrastination is my middle name....well it would be if I could be ar**d to contact Deed Poll."
    • MikeJO
    • By MikeJO 15th Jul 17, 6:06 PM
    • 318 Posts
    • 277 Thanks
    MikeJO
    • #5
    • 15th Jul 17, 6:06 PM
    • #5
    • 15th Jul 17, 6:06 PM
    I don't know the answer but just wanted to say your post was a breath of fresh air. You aren't trying to retain your benefits with a large inheritance.
    Originally posted by Torry Quine
    Several people have told me to do that ("you'll never get caught") but I wouldn't be able to sleep at night, was never an option.
    Procrastination is my middle name....well it would be if I could be ar**d to contact Deed Poll."
    • atush
    • By atush 15th Jul 17, 10:10 PM
    • 16,155 Posts
    • 9,850 Thanks
    atush
    • #6
    • 15th Jul 17, 10:10 PM
    • #6
    • 15th Jul 17, 10:10 PM
    Ok, first thing.

    Start a pension for each of you. Even if you have no earned income, you can put in 2880 which becomes 3600 once tax relief is added. Keep doing this while you have the money to do so.

    Second, you need cash savings to live on so put 12 months of the money into easy access savings. put the rest into a series/ladder of bonds, each one maturing when you need it. So 1, 2, 3 years etc.

    If you have things that need repairing/replacing do so now esp if will make your/her life easier.

    Consider moving to a cheaper or better equipped home now that you have access to cash for a security deposit?
    • bigadaj
    • By bigadaj 15th Jul 17, 10:21 PM
    • 9,579 Posts
    • 6,095 Thanks
    bigadaj
    • #7
    • 15th Jul 17, 10:21 PM
    • #7
    • 15th Jul 17, 10:21 PM
    I guess one of the first things to do is run through your current income and determine what is means tested and what is not, the difference will be what you're looking to finance from your inheritance and consequently give you a timespan for the money.

    With some effort you could set up a range of current accounts and regular savers with your wife that would accommodate most of the money, maybe an average of 2.5% interest, though you would have to set up direct debits, using tesco savers accounts generally and organise standing orders to rotate the money around.

    The traditional option for this over say six years would be to split the money into year blocks and invest them in fixed term savers, the longer the term the higher the rate generally, and you'd then have say £15000 a year coming out every year to live off.

    Timespan would be too short for equity investment, if you did accept risk then p2p lending would give higher returns, though your capital is at risk, certainly possible to get around 1% a month on several platforms before defaults, and default rates are low on many platforms.
    • xylophone
    • By xylophone 16th Jul 17, 9:43 AM
    • 22,352 Posts
    • 12,894 Thanks
    xylophone
    • #8
    • 16th Jul 17, 9:43 AM
    • #8
    • 16th Jul 17, 9:43 AM
    Would you be able to use the money to buy in care for your wife so that you would be able to work part time?
    • Glen Clark
    • By Glen Clark 16th Jul 17, 9:43 AM
    • 3,770 Posts
    • 2,747 Thanks
    Glen Clark
    • #9
    • 16th Jul 17, 9:43 AM
    • #9
    • 16th Jul 17, 9:43 AM
    Ok, first thing.

    put the rest into a series/ladder of bonds, each one maturing when you need it. So 1, 2, 3 years etc.
    Originally posted by atush
    Doubt if that will do better than best buy retail savings accounts, and sounds awful complicated for an amateur investor on the offchance of making a few quid that will go on loss of benefits anyway.
    I agree with the rest of your reply though.
    “It is difficult to get a man to understand something, when his salary depends on his not understanding it.” --Upton Sinclair
    • teddysmum
    • By teddysmum 16th Jul 17, 1:30 PM
    • 8,016 Posts
    • 4,773 Thanks
    teddysmum
    £7500 in 3 Nationwide Flexdirect accounts is a must, at 5% interest with no direct debits required.
    • Sillym00
    • By Sillym00 16th Jul 17, 2:04 PM
    • 37 Posts
    • 49 Thanks
    Sillym00
    If your wife is claiming PIP this can continue completely legitimately since it's not means tested.
    • MikeJO
    • By MikeJO 16th Jul 17, 3:48 PM
    • 318 Posts
    • 277 Thanks
    MikeJO
    Would you be able to use the money to buy in care for your wife so that you would be able to work part time?
    Originally posted by xylophone
    Sadly not, part of her disability is mental and there's no way she'd accept a "stranger" in the house. I can leave her for two/three hours at a time though so it may be that I can work sixteen hours a week (which I understand I can while on Carers Allowance) if I can find something.
    Procrastination is my middle name....well it would be if I could be ar**d to contact Deed Poll."
    • MikeJO
    • By MikeJO 16th Jul 17, 3:51 PM
    • 318 Posts
    • 277 Thanks
    MikeJO
    If your wife is claiming PIP this can continue completely legitimately since it's not means tested.
    Originally posted by Sillym00
    Yes she is and, as I said in the previous post I get CA which we'll also keep, so that'll help obviously.

    Many thanks to everyone for the detailed responses, I've got a lot of research to do.
    Procrastination is my middle name....well it would be if I could be ar**d to contact Deed Poll."
    • MikeJO
    • By MikeJO 16th Jul 17, 6:32 PM
    • 318 Posts
    • 277 Thanks
    MikeJO
    Just another thought, is it worth me going to a financial advisor? Would the cost involved be worthwhile as I'm (obviously) a total novice in this situation, or can you good people talk me through it?
    Procrastination is my middle name....well it would be if I could be ar**d to contact Deed Poll."
    • atush
    • By atush 16th Jul 17, 9:50 PM
    • 16,155 Posts
    • 9,850 Thanks
    atush
    Doubt if that will do better than best buy retail savings accounts, and sounds awful complicated for an amateur investor on the offchance of making a few quid that will go on loss of benefits anyway.
    I agree with the rest of your reply though.
    Originally posted by Glen Clark
    Much more complicated for an amateur to set u a number of current accounts with Direct debits going an and out.
    • atush
    • By atush 16th Jul 17, 9:52 PM
    • 16,155 Posts
    • 9,850 Thanks
    atush
    Just another thought, is it worth me going to a financial advisor? Would the cost involved be worthwhile as I'm (obviously) a total novice in this situation, or can you good people talk me through it?
    Originally posted by MikeJO
    I would think, as you will be using up this money in a period of 5-10 years, an IFA may not be worth the cost.

    But a trip to the CAB or other benefit advice agency might.
    • Malthusian
    • By Malthusian 17th Jul 17, 9:51 AM
    • 2,596 Posts
    • 3,693 Thanks
    Malthusian
    Just another thought, is it worth me going to a financial advisor? Would the cost involved be worthwhile as I'm (obviously) a total novice in this situation, or can you good people talk me through it?
    Originally posted by MikeJO
    Without a change in your circumstances I would say not. If you'd inherited twice the amount I would say yes, but at the rate you will be spending it, trying to make your money grow is unrealistic - you are only going to be trying to stretch it out as long as possible. There is not that much an IFA can do in exchange for his fee.
    • MikeJO
    • By MikeJO 17th Jul 17, 5:00 PM
    • 318 Posts
    • 277 Thanks
    MikeJO
    Thanks again; I've already been to the CAB to find out what I can and can't do regarding deprivation of capital (like upgrading the car, modest holiday, fridge/freezer, washing machine etc) but they weren't very helpful on getting the best out of the lump sum; this place has been much more useful.
    Procrastination is my middle name....well it would be if I could be ar**d to contact Deed Poll."
    • soulsaver
    • By soulsaver 17th Jul 17, 5:30 PM
    • 1,322 Posts
    • 442 Thanks
    soulsaver
    Whilst I also commend the 'not wanting to have my cake and benefits', I'd investigate what options you can legitimately use the inheritance for without impinging on current means tested benefits, if any.
    Remember that some benefits you may lose maybe can't be claimed (replaced) after state pension age. Or affected by political decisions in the interim.
    CAB seems a good place to start, as said earlier.
    There are 24 bottles of beer in a crate. There are 24 hours in a day. Coincidence? I think not....
    • mjfp509
    • By mjfp509 18th Jul 17, 10:07 AM
    • 127 Posts
    • 35 Thanks
    mjfp509
    I know you say you can't afford a 'house' in Devon, but is there anything like a house you could buy outright and live in it to avoid paying high rent a month? e.g. log cabin, new static caravan, that would be yours. The rent you will be paying would reduce your capital in no time.
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