Savings vs. debts! Deprivation of assets?

rogerblack

oxcat1 wrote: »

When I look at the ESA form, it asks only about savings, and about savings I have had in the past. If I enclose additional paperwork, proving the credit card debts, and explaining about struggling to make monthly repayments, are they likely to read it?

They are supposed to read it, yes.

However - as above - it is likely that it doesn't matter.
Self-employed earnings by a partner of 150/week will either almost totally, or totally wipe out any income-related ESA.
Income-related ESA is the only type of ESA that is affected by savings.

In principle, if the savings were the only issue, and the interest payable exceeds 12 pounds a week - then that is a clear other reason for paying off the CC.

If you are entitled to contribution based ESA, this is not at all affected by savings.

Mojisola

oxcat1 wrote: »

The credit cards are in either my husband's name or my own - not joint

Life has dealt you a rotten deal and it may not be something you would consider otherwise but the debts in your name are yours and your OH can't be made to pay them after you die.

Make sure you have your funeral paid for and then ask for debt advice about how to deal with the other debts. It's better to get arrangements put in place early to reduce the worry about them.

Also, think about putting a statement of affairs on the Debt-free board and people will advise about ways to reduce spending.

SandraScarlett

Hi, I'm so sorry to read your sad news, and cannot imagine how difficult things must be for you and your husband. As others have suggested, any equipment that you can buy to improve your comfort and wellbeing at this time, would be money well spent.


I know when claiming DLA there is a special form for the GP to sign when a terminal illness is involved, and there may be a similar situation applying to other benefits.


I'm sorry I cannot be of more help, but I didn't want to read and run. I do wish you and your husband the very best, and I hope you can sort out your finances, so that you have one less thing to worry about.


xx

leveller2911

longtomboy wrote: »

I suppose that is one way of dealing with your debts. Don't pay those in your name because you are terminally ill and make sure that all of the savings are in the partners name.


No one seems to care that if everybody took that action and didn't discharge their debts properly, the rest of us who do pay their way would have to pay more to the banks to compensate them. They were good enough to lend the money, that debt should be paid

I'm all for people paying their debts and you won't find anyone more critical than me of those who don't pay back money they have borrowed.

However I think there are times when we can be a little more caring and consider the the bigger picture here and to be honest Banks,lenders etc can easily take a hit on a debt such as this.

I wouldn't defend people going and maxing out the credit card because they have been diagnosed with a terminal illness but the OP's CC debt on the face of it was not built up post diagnosis so I don't have any problem with the advice given by Mojisola.... The OP may even have CC insurance that may cover the balance or enough fo the balance so as not to have to worry .

Look at it this way the OP has helped to bale out the banks along with the rest of us so they are just getting their contribution back earlier than the rest of us.;)

sueturnersmith

longtomboy wrote: »

I suppose that is one way of dealing with your debts. Don't pay those in your name because you are terminally ill and make sure that all of the savings are in the partners name.


No one seems to care that if everybody took that action and didn't discharge their debts properly, the rest of us who do pay their way would have to pay more to the banks to compensate them. They were good enough to lend the money, that debt should be paid

Andy, do you have NO compassion?

StormyWeather_2

rogerblack wrote: »

As implied above it's somewhat irrelevant I suspect.

Firstly. 9000 pounds worth of savings will affect your benefit by (9000-6000)/250 = 12 pounds a week.
Secondly - if you do not qualify for contributions based ESA, you will not be paid if you have other household income of 150/week. (or at most several pounds).

If you qualify for contributions based ESA in the support group, then savings are never counted.
In the work-related group, they will be after one year - but again - as above, other income will wipe it out.

Paying off CC debt can be not deprivation of capital - but only if you are paying off the debt for some other reason than to get more benefit.

Your benefit is affected by 12 pounds a week by the savings.
If your interest is more than 12 pounds a week, then clearly that would be the other reason.
With 0% cards - this doesn't apply.

At some point in the future the OP will be paying interest. So should they pay the minimum amount for now and when the interest returns to normal pay off a lump sum?

Mojisola

longtomboy wrote: »

I suppose that is one way of dealing with your debts. Don't pay those in your name because you are terminally ill and make sure that all of the savings are in the partners name.

No one seems to care that if everybody took that action and didn't discharge their debts properly, the rest of us who do pay their way would have to pay more to the banks to compensate them. They were good enough to lend the money, that debt should be paid

I wouldn't mind paying extra if it mean that everybody with a terminal illness who only has a very limited time left was able to stop worrying about paying debts before they died.

oxcat1

Well that was a bit of an unexpected turn in the thread!

Please don't worry, Longtomboy: I do have every plan to clear my debts before I pop my clogs, I'm just not in a position to do it right now.

And I certainly didn't run up any debts intentionally. I am only 35 and had no idea life was going to take this unexpected - and deeply unwelcome - turn. I Thought I was managing money quite carefully, including keeping debts on 0% but also maintaining some form of limited savings, precisely to prevent us needing to fall on the state in the case of a sudden unexpected 'rainy day' for which we would otherwise have no protection. I thought my life was going to turn out very differently, and I tried I maintain a relatively balanced and flexible position that would make various options possible. I have made mistakes, for sure, but they were meant well, and I have no intention of screwing others over to my own advantage.

I will do everything I can to clear my debts in time. Clearing off as much of the credit card is all I can do for now, and I would like to think that would be looked on favourably by the DWP as there is no doubt that these debts will not be manageable on the commercial APR rates to which they will in time revert. I will hopefully still be around to clear the rest afterwards.

Everyone else: Thanks for all the helpful - and kind and thoughtful - responses. I don't think I'm in a position mentally yet to consider a funeral plan, even though it is obviously a very sensible option. One to store away though, thank you, and when I am feeling a bit stronger about it all, I shall certainly look into it again.

Thanks.

rogerblack

StormyWeather wrote: »

At some point in the future the OP will be paying interest. So should they pay the minimum amount for now and when the interest returns to normal pay off a lump sum?

For the OP, it doesn't really matter, as they will not, due to other household income qualify for more than several pounds a week ESA.

At the point the interest actually becomes payable and exceeds the reduction of income-related benefit - then yes - there is a clear 100% justification for paying off the CC debt.
(if any income-related benefit is payable, which it may not be)

oxcat1

Please can I just clarify: if my husband earns £150.00 a week, before tax, from freelance work (irregular and unpredictable), it is likely that we will not be eligible for income-related ESA? Or at least not much more than several pounds a week?

So with earnings of about £600 PCM, before tax, out of which we have to pay rent, utilities, council tax, food, credit card bills, etc, we will not be eligible for additional assistance?

I know from a previous claim that I wasn't eligible for contributions-related ESA as I hadn't paid sufficient NI contributions, and at that stage my husband was working full-time, so I received pension credits - of little use to me now!

Is that right? A combined income of £600 PCM, plus my DLA which is not counted, means that we are unlikely to eligible for any further assistance?

Thanks.