Are they savings?

Pixelat0r

Does anyone know for how long they can penalise me for this so-called deprivation of capital? Does it ever clear or is it a permanent stain that I will be punished for until I'm too old for them to care?
I genuinely appreciate all your help, and kind of see how it pans out by the book but do any of you have any ideas what I could have done differently? Or perhaps what you would have done in this situation?

Torry_Quine

They penalise you for the length of time they judge that you would have spent the money down to the level at which you would get benefit.

TELLIT01

If you had used the endowment payout immediately to reduce the mortgage there wouldn't have been a problem. Once you broke the link between the money and the mortgage this money simply became part of your savings for benefit purposes.
If ESA are saying you won't have any entitlement to Income Related benefit once your Conts based period ends you must have other savings too. The money from the endowments was only £14,500, so below the threshold of £16k.
When your Conts expires you would have potential entitlement to Income based, but that would be reduced by about £35 per week if the £14.5k was your only savings, or classed as deprivation.

Pixelat0r

I have £2000 in my current account (presently) and had about £2700 at the time of the original claim but this again isn't pure savings as it's money we pay in for the mortgage direct debit, credit cards, car loan etc. The ISAs plus savings came to about ££17,300 at the time of the original claim and around £16,500 just before I surrendered the ISAs earlier this week.

Frustratingly it was CAB and the building society who suggested I try to recover some of the shortfall by tying it up for a while to earn some interest. I tried, like millions did, to get some compensation for significant shortfall and the bad advice the lead to my predicament but because I used a financial advisor who has since retired I didn't get a penny.

GlasweJen

Are you getting tax credits for the child you still have at school?

If your wife isn't willing to give up the free child care arrangement then she should try making a business out of it. If she does qualify as a child minder she won't be able to claim for her own grandkids as the arrangement you currently have is evidence that she's looked after them for years on a non-commercial basis so the government aren't going to pay up when she doesn't take money at the moment. She can take other people's kids and charge them though and that should help. I'd make sure they all food/nappies/admission fees for going anywhere are paid by your daughters and not by your wife though.

pmlindyloo

Does anyone know how the diminishing capital rules work ?

Have tried to find a link but can't make head nor tail of it!

When would the OP be able to change his claim from contribution based to income based ESA with an inclusion for his wife?

seven-day-weekend

Whilst feeling for you in your predicament (as you say, you tried to do the right thing), I can see why the decision is the way it is.

Unless either you or your wife are near the age where you can claim Pension Credit (currently about 63 I believe), then the free childcare has got to stop.

Check it out here: https://www.gov.uk/pension-credit/eligibility

Pixelat0r

My wife used to work, and I believe we had some of my daughter's credits transferred to my wife so she has enough to claim state pension.

My wife is 50 and I'm 50 next month so still a little way to go. :T

I understand there have to be systems in place to stop people playing the system but when I can't find a single avenue open to me it just stings a bit after all the contributions I've paid.

GlasweJen

I don't think you can donate your contributions to someone else, I'd clarify with your wife what is going on and maybe ask the DWP for a pension forecast for you both. Your wife will need 30 years contributions to qualify for state pension under the current rules, she may well need more in the future.

She can't afford to retire in her 40s to look after her children's children when her own household can't afford to pay the mortgage. Your daughters can claim working tax credits and send your grandchildren to nursery, it will be tough but support for young parents in part time jobs is much more generous than the support for people in their 50s who are not looking for work.

Mojisola

GlasweJen wrote: »

Your wife will need 30 years contributions to qualify for state pension under the current rules, she may well need more in the future.

35 years now.