Helping mum with money

jellybean19_2

Hi all,

Sorry if this is in the wrong category.

So, my mum is about to come into a large amount of money which on the face of it is great. Problem is she has a history of mental health issues, very bad with money and her benefits will stop. 

I have no idea what to suggest, or who to go to for help. I have tried explaining that with her benefits stopping this money will essentially become her income to live on. I know I don't really have a say on what she spends her money on and won't take a penny of it (she keeps offering). I just don't want her spending it all on silly things and having to bail her out financially when the money runs out (done this plenty of times before). I want to find someone who can explain the situation in simple terms to her, advise her on savings/investments options, and arrange for some money to be paid out monthly for her to live on. I have looked at financial advisors bit they all seem so formal and business like, and that's really not going to get through to her. Anyone know where to start?

Thank you for reading. 

74jax

Does you mum have a social worker? Ours helped so much and advised my parents and I on many things, including money. 

Do you have Power of Attorney for her? 

Grumpy_chap

Is it a sufficient amount that your mother could use the capital to buy an annuity, so providing an income until death?

That is an option with some complexities as to whether it is a good option or not but may work in this case.  It stops your mother just spending the lot and assures future income.

She will need a financial advisor and any good one will be business like.  You may be allowed to attend meetings with your mother and ' translate' for her in the presence of the financial advisor.

JJC1956

Maybe set up Direct Debits for all of her bills, at least you will know that they are being paid every month, one less thing to worry about

jellybean19_2

Thanks everyone. 

No social worker. That seems to be my role 🙈

I will have a look at annuities as it's not something I'm familiar with, sounds like it could be a good option though. Maybe she would let me attend the appointment with a financial advisor to 'translate'. I will see if she is willing to get an appointment with someone. 

All her bills are currently direct debit so not worried currently, but she has all these plans for the money and some of them are downright Ridiculous, she totally doesn't see it though am very worried the money will be gone in a couple of years and she won't be able to claim benefits again, and it will fall to me to bail her out again which I really cannot do financially. 

Thanks again everyone.

gettingtheresometime

What about of the money is paid into an account & she gives you total control over that account (you have the card, statements are sent to your address etc) and you set up a standing order to pay over a certain sum each month?

Keep_pedalling

gettingtheresometime said:

What about of the money is paid into an account & she gives you total control over that account (you have the card, statements are sent to your address etc) and you set up a standing order to pay over a certain sum each month?

That would require a LPA being put in place. 

TBagpuss

It might be possible to set up a trust, with you as trustee. As trustee you would control the funds and would be able to pay her a fixed amount each month or week.

Another option (as she is offering to give you money) might be to accept her offer so the money is yours and then simply gift it back to her month by month as income (You would need to take advice about the tax and other implications - you might be able to let her give you the money, then set up a trust for her benefit) 

If she was willing to give you Power of Attorney you could manage the fund on her behalf - as long as she had mental capacity she could revoke the power, and could also deal with fund s on her own account, but if you had any paperwork and log in detaisl it might at least mean that you could keep an eye on things and perhaps discuss any proposed spending with her 

A STEP lawyer could advise about setting up a trust.

tacpot12

I think a financial adviser will be able to advice your Mum - they will understand how to keep the information they give her simple. 

I agree with you that she does need someone to explain to her that if she spends the money unwisely, there is a real risk that Department for Work and Pensions will decide that she is not entitled to any benefits. You might struggle to find an IFA that is willing to say this too her, as many will hid behind the fact that they are not benefit experts (which is certainly try), but they just need to put the fear of god into her about misusing the money. Once she understands the risk, she can take their advice about how to manage the risk, and one option is to give you a Power of Attorney to manage this money, but potentially not some other aspects of her financial life.  

Jude57

As well as an IFA for the investment side and a STEP lawyer for a trust, might it be worth your mum speaking to a welfare rights adviser so they can explain the benefits side of things? They're used to explaining very complex rules in a straightforward way and will be able to speak with authority on deprivation of assets.

CAB have excellent advisers, but they are over subscribed so it may take a while to get an appointment. Some local authorities have welfare rights teams, as do some housing associations.

Edited to add that if any of your mum's current benefits are health related, they may not be affected by her inheritance as they aren't means tested.

Brie

Keep_pedalling said:

gettingtheresometime said:

What about of the money is paid into an account & she gives you total control over that account (you have the card, statements are sent to your address etc) and you set up a standing order to pay over a certain sum each month?

That would require a LPA being put in place. 

KP - why?  I can see that an LPA might be a good idea in general for the OP's mom situation but surely they could in the first instance simply agree to working this way??