Incapacity benefit and lump sum

zee_2

ask someone who knows , the max you can afford to leave in penson fund for pension payments , I made mistake of taking max sum offered when pension was being sorted for payment , if I had left a bit extra in fund at the time , I would have recieved thousands more by now [ quite happy with pension ] as a result of not knowing who to ask and was very ill at time [ 1990,s]

pmlindyloo

Now we know a little more about your circumstances may I offer you a word of warning and perhaps a plea to get some financial advice about your pension?

When you are transferred over to ESA and if they find you eligible then you would be placed in one of 2 groups. The Support Group is contribution based and your pension(lump sum and weekly payment) would be treated as it is now.

However, if you are placed in the work related group, after one year that is means tested. Your weekly pension sum would be taken into consideration and lower your award of ESA. I suspect that your pension lump sum would also be taken into account and you would not be eligible for ESA at all.

Now you will be protected for a while under the rules for transferring from IB to ESA. However, with the introduction of the Universal Credit things could change dramatically.

I am telling you this to give you a 'heads up' as regards your financial planning.

You may want to think about deferring your private pension until you are of pension age because the rules for older people are different as regards savings and capital.

My sister was on contribution based ESA, was transferred to income based ESA (after the year) and had her ESA reduced becuase of her small pension (they take all of it into account.) This, in effect meant that she 'lost' all her pension.

If I were you I would get some advice from CAB and a pensions advisor.

As regards the car (I hadn't forgotten!) do you get DLA?

josoph

I thought of me being the main driver and her as second as it's cheaper for insurance.She will be living at home but it gives her more scope of Unis she can apply to as the car will ease the length of the journey

Dunroamin

josoph wrote: »

I thought of me being the main driver and her as second as it's cheaper for insurance.She will be living at home but it gives her more scope of Unis she can apply to as the car will ease the length of the journey

You seem to be missing the point.

A lump sum payment of £17,000 will stop all your means tested benefits so you'll need to hang on to the money to pay for your rent and council tax. You may be allowed to buy a cheap car for yourself but buying something expensive (or giving your money away) to get your savings below the threshold will leave you being assessed as if you still had the same money.

You and your daughter should really not worry about the student loans she'll be taking out and, if you don't understand this, you should read up on the subject.

You may need to bear in mind (if you haven't already done so) that you will lose the child tax credits you receive for her during this coming summer.

This is a time to be very careful with your money, not to go giving it away!

Mojisola

I don't think that a disabled person who spent money from a lump sum on a reasonably priced car would need to be worried about DOC. If the car wasn't to be kept at the home address and therefore couldn't benefit the claimant, it would be a different matter.

Most students would struggle to pay for insurance - have you looked at how much that would cost in the first few years of her driving career?

sunnyone

josoph wrote: »

I thought of me being the main driver and her as second as it's cheaper for insurance.She will be living at home but it gives her more scope of Unis she can apply to as the car will ease the length of the journey

Do you drive and will you be the main driver or will you be "fronting" which is illegal and could leave you both in serious troble?

Are the DVLA aware of your disability if its one that must be reported?

Dunroamin

Mojisola wrote: »

I don't think that a disabled person who spent money from a lump sum on a reasonably priced car would need to be worried about DOC. If the car wasn't to be kept at the home address and therefore couldn't benefit the claimant, it would be a different matter.

Unfortunately, the OP seems to be planning on doing this specifically so that s/he can get her savings below the threshold for means tested benefits, as is shown in the first post. As you know, "intention" is one of the most important aspects in decisions on deprivation.


"I am aware that if you have savings of over 9k you need to advise benefits and also housing and council tax benefit.If I would like to give my daughter some money and buy her a car,meaning I will have under the 9k.Am I able to do this?"

In addition, I don't think most people would consider £8,000 to be a "reasonably priced car" in these circumstances.

McKneff

josoph wrote: »

Thankyou Lindylou your advice is very helpful.
Dunroamin I do claim housing and council tax benefit.I am not in a hurry to get rid of the money.I am a single parent and thought it would be nice to get my daughter through her driving test and get her a car.As I am disabled it would be a great help to us both as we rely on friends at the moment.As she will be in untold debt when he goes to University,my helping her will ease a lot of the stress

OP, you really should have said (the bold type) to start with, probably all of the answers would have been different.

My first post was 'google deprivation of assets' that still stands

FBaby

Don't forget to take into account the cost of petrol, repairs, insurance etc... that you and your daughter will need to pay for. If your benefits are cut for some time because of your savings/pension, you might find it difficult to pay for these on your budget.

josoph

I apologise for not giving full information but I didn't know that it would be relevant.I have made an appointment with someone to discuss the benefits side of this and will now look to someone to discuss my pension with.Thankyou for all your advise it was very helpful:beer: