Savings

hunnyleigh

hi im in need of some advice, a friend of mine was struggling to pay her mortgage and fell behind so much so that her house was due to be reposessed. she managed to sell the house intime to pay off the debt and was left with some savings! however for instance she was left with £36,000. she has 3 children and she wishes to put 10 thousand in each account for each kid, as inheritance if something was to happen to her at a later date because she was originally buying the house so she had something to leave to her children if something were to happen. however she is a little worried now as she will have to claim benefits will she be entitled to claim benefits until she is fit to return to work? or will they question her about giving her children so much money each as inheritance? i hope this makes sense to someone she is not fit to return to work as she has lost her husband which eft her in a bad place and now she has lost there family home after 28 years i just want something to go right for her for a change.

droopsnoot

You'd be better asking this on the Benefits board (http://forums.moneysavingexpert.com/forumdisplay.php?f=139) or it's Child Support sub-board. I think it's more about whether having the savings would affect your friends benefits rather than specifically about her savings.

jimjames

Giving the money away would probably count as deprivation of capital so would disqualify for benefits. Inheritance only happens on death, you can make lifetime gifts but not to deprive yourself of capital which affects benefits.

There are limits for savings that are disallowed for benefit calculations though.

hunnyleigh

she isnt just giving it away to them, most of it she owes to them anyway over the last 4 years since loosing her husband she has borrowed money left right and centre and she owes alot of it back to her children also she owes £12,000 or there abouts on credit cards she has taken out over the years to help her with things/funeral. how would she have to prove the money she owes to people im so sorry if i sound thick but im not in this situation and never hope to be and she just doesnt know where to start. thanks for your help guys xx

jimjames

hunnyleigh wrote: »

however for instance she was left with £36,000. she has 3 children and she wishes to put 10 thousand in each account for each kid, as inheritance if something was to happen to her at a later date because she was originally buying the house so she had something to leave to her children if something were to happen. however she is a little worried now as she will have to claim benefits will she be entitled to claim benefits until she is fit to return to work? or will they question her about giving her children so much money each as inheritance? .

hunnyleigh wrote: »

she isnt just giving it away to them, most of it she owes to them anyway over the last 4 years since loosing her husband she has borrowed money left right and centre and she owes alot of it back to her children also she owes £12,000 or there abouts on credit cards she has taken out over the years to help her with things/funeral.

I think she needs to be clear what is what. Your 2 posts show rather different things and to be honest don't really make sense. If she needs the money to live on then she shouldn't be giving it to the kids. Anything left when the time comes would be their inheritance anyway.

If she owes £12k on credit cards that weren't mentioned then she doesn't have £36k it is £24k. It is crazy to have money in the bank and be paying interest on credit cards.

Paying off credit cards is not deprivation of capital but she needs to work out exactly what her financial position is to total up savings and debts. If she owes money to kids then that isn't giving them an inheritance it is paying back debts.