Should my wife and I spend all our savings? 8 February 2020 at 10:15AM in MoneySaving Dads 49 replies 6.2K views

3stones

hb2 said:

Firstly, I will reiterate that you will not be able to claim 'benefits' if it is deemed that you deliberately gave away/spent your savings in order to do so. Google 'deprivation of assets'. This would also include getting help with care home costs if that became necessary (and the LA can look back many years to decide this).

I'm constantly trying to get an understanding of deprivation of assets. In anyone's opinion would a final flurry of nice holidays or experiences count as DOA or is it more about handing down money and buying assets which could be sold at a latter date. Meaning holidays etc when it is over the money is irretrievable.

LionelChuttleworth

3stones said:

hb2 said:

Firstly, I will reiterate that you will not be able to claim 'benefits' if it is deemed that you deliberately gave away/spent your savings in order to do so. Google 'deprivation of assets'. This would also include getting help with care home costs if that became necessary (and the LA can look back many years to decide this).

I'm constantly trying to get an understanding of deprivation of assets. In anyone's opinion would a final flurry of nice holidays or experiences count as DOA or is it more about handing down money and buying assets which could be sold at a latter date. Meaning holidays etc when it is over the money is irretrievable.

At 77 Peter and his wife cant be expecting to live that much longer (?) so holidays, if they are able, is an excellent choice, they dont say what they spend a month in excess of pensions, but, if they live frugally it cant be that much, even if its £500 a month, £80,000(without any growth) will last them until 92.

Of course there is a mortgage free property to take care of any care home fees for quite some time I imagine.

As Peter pointed out his (their) investment was achieved by NOT taking holidays, so their savings fall within my definition of "deferred spending". I hope they have some lovely holidays, and if they eventually have to claim a few quid, it wont be much anyway.

MysteryRegular

You really need to let your children and grandchildren make their own way. Concentrate on yourselves!!  

You don't like people claiming benefits, but in turn you are giving away free money to rellys who haven't earned it

Spend your cash, have holidays enjoy life, or you will die and they will all be squabbling over it 

hb2

Deprivation of assets is a difficult one as it often comes down to the attitude of a single DWP decision maker. There has to be the intention to spend the money in order to become eligible for benefits and the spending has to be considered unreasonable. Replacing furniture and appliances, a little car, holidays etc are OK but having a round the world cruise each year and buying everything top-of-the-range probably wouldn't. In between is anyone's guess!

Fireflyaway

Enjoy your money, you obviously made some sacrifices along the way so have a few nice holidays and treat yourself. I'd keep something for emergencies and household things like redecorating / replacing the heating etc but what's the point of the money just sitting in the bank and you missing out on fun? 80k is not much in terms of care costs. It wouldn't last long. My neighbour was paying £56k a year residential care home fees. Ironically the person in the room next door paid nothing because they had no money and were state funded! As for leaving an inheritance id rather see my parents having fun and then they leave me something sentimental like a piece of their jewellery or a painting they loved. If you want to help your kids then pay for your funerals! 

thorsoak

Gunnerpete - you say that it has taken you and your wife over 40 years to save your £80,000.   What were you saving for?   A rainy day?    I'm in the same age bracket as you and your wife - sadly my husband died nine years ago - and so now I'm on my own, and any savings that we had are diminishing rapidly - but as long as I have enough to live on - like you my pension is just over the bar for receipt of pension credit etc - but I can live, and I use what is left of our savings on holidays - which really means that I go to see my far-flung offspring.    They all encouraged their dad and to go "skiing (spending the kids' inheritance) - they will get something when I finally shuffle off this mortal coil and they sell the house - that is if there is any house left and I don't have to go into Care.   But I'm not going to feel bitter - we enjoyed saving and spending as we went along, and I would advise you to look at life in a lighter way.   Tonight I have just heard of the death of a dear friend who moved house three weeks ago and was looking forward to her retirement next year.    She's been skrimping and saving and was looking forward to taking holidays - which she never managed.

LionelChuttleworth

Gunnerpete joined, posted and hasnt looked at the thread since.

Must be on holiday .

3stones

hb2 said:

Deprivation of assets is a difficult one as it often comes down to the attitude of a single DWP decision maker. There has to be the intention to spend the money in order to become eligible for benefits and the spending has to be considered unreasonable. Replacing furniture and appliances, a little car, holidays etc are OK but having a round the world cruise each year and buying everything top-of-the-range probably wouldn't. In between is anyone's guess!

Thank you that is probably the best summing up on the subject I have ever read. 

lisyloo

3stones said:

hb2 said:

Firstly, I will reiterate that you will not be able to claim 'benefits' if it is deemed that you deliberately gave away/spent your savings in order to do so. Google 'deprivation of assets'. This would also include getting help with care home costs if that became necessary (and the LA can look back many years to decide this).

I'm constantly trying to get an understanding of deprivation of assets. In anyone's opinion would a final flurry of nice holidays or experiences count as DOA or is it more about handing down money and buying assets which could be sold at a latter date. Meaning holidays etc when it is over the money is irretrievable.

It’s a grey area, but certainly (as an example) giving away a home to get care fees is a classic case as would be blowing it all on a round the world cruise. There’s a huge grey area but buying Christmas and birthday presents and going on holiday in line with your means is not deprivation.
my MiL was fully funded by the state in a nursing home and she was still allowed to go out, give gifts and even give to charity (if that was her usual habit and in line with her means).
there is also the fact that if you draw out cash for say Christmas presents, then who is to know what it’s for?? I’m not suggesting benefit fraud here just that there’s a massive grey area. If you transfer a house it totally traceable and obvious. If you draw out an extra £20 a week then who knows what is goes on? You might not even keep records yourself.

i think it’s a bit of a red herring unless it’s deliberate.

i would ask though, why are you helping your families if they are much more able to help themselves? They are younger and if they are struggling they should stand on their own two feet and get an extra job or two rather than take your money, especially if you are having issues yourself.

3stones

lisyloo said:

3stones said:

hb2 said:

Firstly, I will reiterate that you will not be able to claim 'benefits' if it is deemed that you deliberately gave away/spent your savings in order to do so. Google 'deprivation of assets'. This would also include getting help with care home costs if that became necessary (and the LA can look back many years to decide this).

I'm constantly trying to get an understanding of deprivation of assets. In anyone's opinion would a final flurry of nice holidays or experiences count as DOA or is it more about handing down money and buying assets which could be sold at a latter date. Meaning holidays etc when it is over the money is irretrievable.

my MiL was fully funded by the state in a nursing home and she was still allowed to go out, give gifts and even give to charity (if that was her usual habit and in line with her means).
i would ask though, why are you helping your families if they are much more able to help themselves? They are younger and if they are struggling they should stand on their own two feet and get an extra job or two rather than take your money, especially if you are having issues yourself.

I'm only asking out of curiosity as i'm only in my fifties so hopefully am a long way off from nursing/care homes . For many  I think you have answered your own question with your statement about your MIL. This is why people look to pass down wealth if they can as they see this kind of arrangement whether rightly or wrongly as unfair, one person paying for themselves and in the bed next door the other one not. I'm not judging only saying what I know bugs people.