what counts as savings

village_idiot_2

I’m about to receive a lump sum from my critical illness policy, at the same time I’m being made redundant in 12 weeks.

it’s the first time I’ve been made redundant so not sure what if any benefits I will get and given that im over 50 the job chances are very low,will the lump sum from my critical illness count as savings?

DomRavioli

Yes. Capital which is freely accessed such as a payout from a policy is classed as savings or capital, and if you go over you must notify if you receive benefits as you would be committing fraud.

village_idiot_2

what if I spend it, move it to a family member or pay myhouse off before I get my redundancy notice?

pmlindyloo

To start the ball rolling.....

If you have paid NI contributions for the last couple of years then you will be entitled to contribution based JSA for 26 weeks.

This is not means tested so your redundancy money and criticla illness lump sum will have no effect.

If you need to claim means tested benefits then your redundancy money will be counted as savings as will any household income (need details for further help - how much redundancy? partner - working? children? mortgage?)

As regards the critical illness cover lump sum - is it being provided for a particular purpose? e.g to pay off a mortgage?

sorcerer

village_idiot wrote: »

what if I spend it, move it to a family member or pay myhouse off before I get my redundancy notice?

They have that covered, you could be classed as "deprevation of earning", which would mean you spent it on purpose and theirfore are classed as still having the money.

sorcerer

I wonder what would happen if he put the money into a pension?

village_idiot_2

Never been out of work before so will get JSA,
redundancy money will be under 8k
critical illness cover was to cover mortgage but is not tied to it as in we dont have to pay it off with it. we are looking to use it to clear the debts and make a lump sum towards mortgage.

redundancy has come along a wrong time, although even putting our numbers without my wage into gov website it says we are not entitled to anything any way so problem may never happen

Bigmoney2

village_idiot wrote: »

Never been out of work before so will get JSA,
redundancy money will be under 8k
critical illness cover was to cover mortgage but is not tied to it as in we dont have to pay it off with it. we are looking to use it to clear the debts and make a lump sum towards mortgage.

redundancy has come along a wrong time, although even putting our numbers without my wage into gov website it says we are not entitled to anything any way so problem may never happen

Paying off loans/mortgage can be classed as deliberate deprivation of capital in order to claim benefits.

The point of redundancy pay is to live off till you get another job, not to clear debts/mortgage

As said already caim JSA contribution based for the 6 months assuming you have the required NI contributions.

Look at SMI (support for mortgage interest) to cover some of the mortgage.

Will the critical illness cover pay out for redundancy or do you have some sort of income protection policy?

Do you have a partner who's working? If so you may be entitled to working tax credits depending on hours/income

.

village_idiot_2

redundancy pay would not be used as its not happened yet so that can be taken out.

the simple question i was asking is does a lump sum from a policy payout count in means testing thats been answered

thank you