Should I use redundancy to repay 0% debts

lammylover

My husband has been made redundant and finishes next week. We have some debts which the redundancy pay will cover. However they are on 0% credit cards at the moment. Did we ought to pay them off or put the money into savings accounts and pay off gradually to maybe earn a little interest??
We read somewhere that if he goes on to claim income based benefits (he's 62 so job not looking likely) they will want to know where money has gone.
Thanks :undecided

p00hsticks

lammylover wrote: »

We read somewhere that if he goes on to claim income based benefits (he's 62 so job not looking likely) they will want to know where money has gone.
Thanks :undecided

Yes, that's my understanding. It's ok to continue making the minimum payments on credit cards, pay the required monthly mortgage payments etc, but any overpayments that aren't necessary could be regarded as 'deliberate deprivation' by DWP / the Pension service and you could be treated as if you still had the money for the purposes of assessing eligibilty for means tested benefits.

MEM62

It is difficult to say without a more comprehensive picture of your overall financial situation.


For example, if you did not pay them off how would you continue making payments? Do you work? Is there any other income into the household? Can you cover all you other living costs while you husband is not working? Do you already have an emergency fund?


If servicing payments is no problem and you can take care of your other bills then you would be better off leaving the money saved or invested. If that is not the case then you need to make a judgement in light of your overall financial circumstances.


Others may confirm but believe that redundancy is disregarded for some means tested benefits - although I can't see that paying off credit card debt can be seen as asset deprivation.

dizzydoll

lammylover wrote: »

My husband has been made redundant and finishes next week. We have some debts which the redundancy pay will cover. However they are on 0% credit cards at the moment. Did we ought to pay them off or put the money into savings accounts and pay off gradually to maybe earn a little interest??

That's up to you.
I know what I would do from a purely moneysaving point of view, but perhaps you would be more comfortable knowing the debts were paid off once & for all (and without having the temptation to spend the redundancy money on something else instead)

lammylover wrote: »

We read somewhere that if he goes on to claim income based benefits (he's 62 so job not looking likely) they will want to know where money has gone.
Thanks :undecided

Even if they do ask, it won't de difficult to explain with evidence if necessary

lisyloo

If they ask for evidence of your savings and it shows a big lump sum disspearing then they are duty bound to ask where it went.

I don't think paying off debt is in the same bracket as buying a new car or going on a cruise.
I personally would not say it's asset deprivation but it's up to them how they interpret it.
At least you are forewarned and know they may well ask and why they are asking.

BTW - if he goes onto JSA then he will be "hounded" to look for jobs.
Personally I agree that people getting benefits should expect to be looking however I would desribe the way the system is implemented as "hounding".
Some people need this, but for genuine applicants it can be totally soul destroying and even counter-productive.

My DH was out of work last year and all I can say is that you have you work cut out by trying to provide the right kind of support.
Best of luck.

bigadaj

lisyloo wrote: »

If they ask for evidence of your savings and it shows a big lump sum disspearing then they are duty bound to ask where it went.

I don't think paying off debt is in the same bracket as buying a new car or going on a cruise.
I personally would not say it's asset deprivation but it's up to them how they interpret it.
At least you are forewarned and know they may well ask and why they are asking.

BTW - if he goes onto JSA then he will be "hounded" to look for jobs.
Personally I agree that people getting benefits should expect to be looking however I would desribe the way the system is implemented as "hounding".
Some people need this, but for genuine applicants it can be totally soul destroying and even counter-productive.

My DH was out of work last year and all I can say is that you have you work cut out by trying to provide the right kind of support.
Best of luck.

Utter rubbish, if you claim benefits then you need to provide evidence, if you don't like that then just don't claim.

I took redundancy before Xmas and have been on contribution based jsa since then, which will run out in may in any case, and it's been very straightforward.

You've made this point before and it smacks of double standards, as in I want those nasty scroungers being hounded, but won't submit to scrutiny myself.

bigadaj

OP, you need to post more details to get a sensible response.

Your husband will get contribtution based jsa for six months if he's been employed for the last two years but most other things are means tested, so it will depend on your household income, level of debts, value of redundancy payment etc.

lisyloo

if you claim benefits then you need to provide evidence

I have no argument with that principle, in fact as a tax payer I fully support it.
What is wrong is that it has to be in the specific measurements that the JSA want.
So for example you have to have made X application via their specific on-line system.
If you aren't computer literate then tough - no other form is acceptable.
If you are (for example) a CEO or board member and you've busted a gut on entirely appropriate activties for your level of job e.g. networking with other board members at conferences and social events, none of that counts because it's not one of thing they count, it must be on-line applications via their website.
It does not matter if that's appropriate for your position or not or whether you can use a computer or not or indeed whether you access to a computer.

One guy recently face sanctions because he didn't meet the target despite the fact he had no access to on-line resources.
What's your solution - chuck him on the streets and let him starve?

if you don't like that then just don't claim

Do you really think that sort of comment is helpful to anyone?
Everyone knows they have the option not to claim.
In fact that's what happened in the end, it simply wasn't worth it.

You've made this point before and it smacks of double standards, as in I want those nasty scroungers being hounded, but won't submit to scrutiny myself.

Utter rubbish.
As I said I'm perfectly happy with the principle.
I just think it's silly to send a CEO on a CV writing course when they could be looking for jobs or making them apply on-line when networking activites are much more likely to be successful for theit type of job.

I'm genuinely glad you didn't have the same experience as I've seen at close quarters.
Perhaps you had a job they understood. They did not understand at all what my husband did.

I don't actually want anyone to be hounded.
I would like those who cannot work to be treated with dignity and others to be helped in appropriate ways which isn't always done by ticking boxes.

I am genuienly glad your experience was difference, so if we disagree then I'm glad for you.

bigadaj

Of course we disagree, it's just the case that your initial comments came across very much as double standards.

Also if you're partners experience was last year then things have tightened up considerably since then, real changes came in in November and my main problem is that their staff all have slightly different ways if interpreting things.

What I do is fairly technical and so I'm largely left on my own to get on with it which were all happy with.

Current process is that you're protected for three months, ie jobs that match your experience and previous salary and after that you're expected to look more widely.

Probably similar to you my claim isn't based on a need to feed or house myself but on the basis of entitlement and their online resource actually isn't bad at all. I also want the fact that I'm currently unemployed recorded and included within figures to stop the politicians saying things are all rosy.

I've seen nothing as restrictive as you've claimed, part of my search is networking, speaking to ex colleagues and clients etc, but I use their website and apply through there if something applicable comes up. It often has which is slightly surprising but many companies and agencies list there because it's free and open.

There's plenty of access to computers in job centers and libraries so no great problem, whilst some might be challenged by this then no reason why they shouldn't be.

Many people would say that people who don't need support shouldn't claim, but that's your choice and it's good to have the luxury to have the option.

Why not send a CEO on a Cv writing course, there's plenty of time to do that and network, job search etc as well. In fact if you're a CEO then work would probably have taken up longer thana. Normal 9 to 5 job anyway so nothing lost. I have been asked about this said I'm fine and it's been left there. Also applied for additional training though this is much more slowly forthcoming.