Inheritance on Benefits. Stressful and depressing.

Dr_Z

Time2count said:

To help set your mind at rest, here's my story...
Received c. £35k inheritance. Called housing benefit to stop it immediately before I'd even put the cheque in the bank. 3 years later claimed housing benefit again. The expenditure was never queried, although I did expect it to be. I was working on min wage all throughout this period. I was very fortunate to have received the inheritance when I did as a year later my landlord decided not to renew my tenancy. I went from a furnished flat I wasn't allowed to decorate to an unfurnished flat that I was! I kept all my receipts for the furniture, carpets, paint, curtains etc but was never asked for them (in fact I still have them somewhere). I was receiving around £500/month housing benefit before the inheritance so 3 years of paying full rent plus furnishing the new place would be easy to show. However I also swapped our annual £9.99 sun holiday for buying passports and we had a couple of holidays abroad (Ireland and Isle on Man) plus weekends away in that time period as well. 

Work out the total of the benefits that will stop each month, multiply by 12 and that is the bare minimum they'd expect your inheritance to reduce by each year. Add in any needs - replace furniture/ car/ disability aids etc. And then add a further £3-4k a year to have a better quality of life - even if that just means the ability to go to the supermarket and put whatever you like in the trolley!
My favourite moment of having the money was taking my son (aged 10/11 at the time) away for a day at the coast and telling him I was going to say yes to anything he wanted. Previously he'd have to choose whether it was crazy golf or arcades, ice cream or doughnuts etc. That magical day we did everything he wanted and I recall him having 3 ice creams and I didn't spend the day mentally working out what I could cut back if we overspent 😀

Thank you for sharing that, that is reassuring.  

Yes, stuff like your last paragraph is wonderful, and I can imagine how great that must have felt.
 
 Our kids are all adults now,  but while we appreciate we can't gift them thousands of pounds randomly, we had hoped that we'd at least be in a position where, say, if my daughters washing machine blew up and she was stressing about how she was going to replace it, we'd be able to help. 

Neither my wife, nor myself have ever been strongly motivated by money, even when I was able to work full time, we have always both been of the opinion that, as long as the bills are paid, and there is food on the table we are happy, so it's not like we'd be rushing out to buy fur coats ... but if we can't do a little bit for our family too, that would be sad.   

Dr_Z

Keep_pedalling said:

One other point, as you are going to be living off this money for a considerable time make sure you maximise the amount interest you earn on it. I would put your first years requirement in an instant access account, a similar amount in a 1 year fixed term bond and the rest in longer fixed term bonds.

No need to use ISAs as with the low income the two of you are on you can take advantage of the starting savings rate which combined with your personal savings allowance means that each of you can earn up to £6000 of interest tax free. 

Thank you. 

Yes this does sound like wise advice,  I think this demonstrates quite how naive I am with money, as I hadn't even considered that we could earn some interest to slow the erosion of this money!  

powerspowers

Time2count said:

To help set your mind at rest, here's my story...
Received c. £35k inheritance. Called housing benefit to stop it immediately before I'd even put the cheque in the bank. 3 years later claimed housing benefit again. The expenditure was never queried, although I did expect it to be. I was working on min wage all throughout this period. I was very fortunate to have received the inheritance when I did as a year later my landlord decided not to renew my tenancy. I went from a furnished flat I wasn't allowed to decorate to an unfurnished flat that I was! I kept all my receipts for the furniture, carpets, paint, curtains etc but was never asked for them (in fact I still have them somewhere). I was receiving around £500/month housing benefit before the inheritance so 3 years of paying full rent plus furnishing the new place would be easy to show. However I also swapped our annual £9.99 sun holiday for buying passports and we had a couple of holidays abroad (Ireland and Isle on Man) plus weekends away in that time period as well. 

Work out the total of the benefits that will stop each month, multiply by 12 and that is the bare minimum they'd expect your inheritance to reduce by each year. Add in any needs - replace furniture/ car/ disability aids etc. And then add a further £3-4k a year to have a better quality of life - even if that just means the ability to go to the supermarket and put whatever you like in the trolley!
My favourite moment of having the money was taking my son (aged 10/11 at the time) away for a day at the coast and telling him I was going to say yes to anything he wanted. Previously he'd have to choose whether it was crazy golf or arcades, ice cream or doughnuts etc. That magical day we did everything he wanted and I recall him having 3 ice creams and I didn't spend the day mentally working out what I could cut back if we overspent 😀

Thanks for sharing @Tim@Time2count. 

@Dr_Z@Dr_Z I hope you are starting to feel better. It’s a big change going from nothing to having some money behind and I can completely see why it is stressful. There is nothing wrong with doing things to improve your and your wife’s standard of living. Living with a disability and being a carer are tough situations and you deserve to relax and take care of yourselves. All the best 

Grumpy_chap

Dr_Z said:

 
 Our kids are all adults now,  but while we appreciate we can't gift them thousands of pounds randomly, we had hoped that we'd at least be in a position where, say, if my daughters washing machine blew up and she was stressing about how she was going to replace it, we'd be able to help. 

I don't see any reason why you could not help your daughter in that type of situation.

Your adult kids might also still enjoy an ice cream with a flake
Quality time with your parents is a reward no matter how old you are.

Dr_Z

I just an update 

We received the inheritance (well, an interim payment of £50k) 

We had previously knuckled down on the maths, and calculated (and accepted, quite happily) that we’d pay have around £800 per month, or £10k a year, so guessed that allowing for inflation, rent increases, unforeseen expenses etc, we’d probably get 8-10 years from the inheritance.  

However, the DWP then contacted us to say that while my wife would no longer receive income related ESA … she would immediately transfer over to Contributions based ESA, and this would not be means tested.  We called them back (twice) to confirm it was correct, and they say it is. When we asked why we were told different before, they suggested we may have been misinformed because they didn’t realise my wife was in a particular “support group” 🤷‍♂️

So effectively we’ll only be £180 per month into the Inheritance.  Which I figure would be covered by the interest on the £100k even on a bog standard bank account? and we could effectively fritter away the other £50k (full inheritance is around £150k)  on whatever we liked, and still remain relatively secure (obviously we wouldn’t, I mean hypothetically). … and never have to trouble the Housing Benefit / Council tax folks ever again! 

Finally,  now this inheritance actually feels like a gift, rather than a liability!  

Thanks to everyone that helped 

HillStreetBlues

Enjoy

sammyjammy

Dr_Z said:

I just an update 

We received the inheritance (well, an interim payment of £50k) 

We had previously knuckled down on the maths, and calculated (and accepted, quite happily) that we’d pay have around £800 per month, or £10k a year, so guessed that allowing for inflation, rent increases, unforeseen expenses etc, we’d probably get 8-10 years from the inheritance.  

However, the DWP then contacted us to say that while my wife would no longer receive income related ESA … she would immediately transfer over to Contributions based ESA, and this would not be means tested.  We called them back (twice) to confirm it was correct, and they say it is. When we asked why we were told different before, they suggested we may have been misinformed because they didn’t realise my wife was in a particular “support group” 🤷‍♂️

So effectively we’ll only be £180 per month into the Inheritance.  Which I figure would be covered by the interest on the £100k even on a bog standard bank account? and we could effectively fritter away the other £50k (full inheritance is around £150k)  on whatever we liked, and still remain relatively secure (obviously we wouldn’t, I mean hypothetically). … and never have to trouble the Housing Benefit / Council tax folks ever again! 

Finally,  now this inheritance actually feels like a gift, rather than a liability!  

Thanks to everyone that helped 

Thats brilliant news, enjoy x

housebuyer143

Dr_Z said:

I just an update 

We received the inheritance (well, an interim payment of £50k) 

We had previously knuckled down on the maths, and calculated (and accepted, quite happily) that we’d pay have around £800 per month, or £10k a year, so guessed that allowing for inflation, rent increases, unforeseen expenses etc, we’d probably get 8-10 years from the inheritance.  

However, the DWP then contacted us to say that while my wife would no longer receive income related ESA … she would immediately transfer over to Contributions based ESA, and this would not be means tested.  We called them back (twice) to confirm it was correct, and they say it is. When we asked why we were told different before, they suggested we may have been misinformed because they didn’t realise my wife was in a particular “support group” 🤷‍♂️

So effectively we’ll only be £180 per month into the Inheritance.  Which I figure would be covered by the interest on the £100k even on a bog standard bank account? and we could effectively fritter away the other £50k (full inheritance is around £150k)  on whatever we liked, and still remain relatively secure (obviously we wouldn’t, I mean hypothetically). … and never have to trouble the Housing Benefit / Council tax folks ever again! 

Finally,  now this inheritance actually feels like a gift, rather than a liability!  

Thanks to everyone that helped 

That's great but do not put it in the bog standard bank account. You will get almost no interest on it. Look for a high interest savings account which you will find is paying around 4%. Split it over two banks because you only get 85k government protection if the bank goes under. 

born_again

housebuyer143 said:

Dr_Z said:

I just an update 

We received the inheritance (well, an interim payment of £50k) 

We had previously knuckled down on the maths, and calculated (and accepted, quite happily) that we’d pay have around £800 per month, or £10k a year, so guessed that allowing for inflation, rent increases, unforeseen expenses etc, we’d probably get 8-10 years from the inheritance.  

However, the DWP then contacted us to say that while my wife would no longer receive income related ESA … she would immediately transfer over to Contributions based ESA, and this would not be means tested.  We called them back (twice) to confirm it was correct, and they say it is. When we asked why we were told different before, they suggested we may have been misinformed because they didn’t realise my wife was in a particular “support group” 🤷‍♂️

So effectively we’ll only be £180 per month into the Inheritance.  Which I figure would be covered by the interest on the £100k even on a bog standard bank account? and we could effectively fritter away the other £50k (full inheritance is around £150k)  on whatever we liked, and still remain relatively secure (obviously we wouldn’t, I mean hypothetically). … and never have to trouble the Housing Benefit / Council tax folks ever again! 

Finally,  now this inheritance actually feels like a gift, rather than a liability!  

Thanks to everyone that helped 

That's great but do not put it in the bog standard bank account. You will get almost no interest on it. Look for a high interest savings account which you will find is paying around 4%. Split it over two banks because you only get 85k government protection if the bank goes under. 

Not forgetting max use of ISA.