Trying to help mother and need guidance

martycc

Firstly hello and thanks for reading. 

I'm after some guidance to assist my mother, knowing little about benefits my mum has turned to me for guidance on her financial situation. 

My mother is 64 y/o and is claiming ESA and DLA. She had been on benefits all her adult life more or less.
She is about to inherit around 50k.
So, she is going to declare this and lose her ESA which is fine. As I understand DLA won't change as it is means tested. 
She will have to pay council tax and her rent.
So 50k isn't a lot of money (yes it is but not over several years.) She spends very little but she does want to help her grandkids out.
Now, I’ve learned all about deprivation of capital and those rules however she retires in 2021 so won't ever claim ESA again. So the money is hers to spend as she sees fit as long as it lasts until retirement, is this correct?
Does this all make sense? Am I missing something? Is this wrong?

As for pension, her forecast states in 2021 she'll get full state pension due to 44 years of contributions. Is this also correct? I didn't know you got NI credit when on benefits. 

I just want her to be legal, not abuse the system but maybe for the first time in her life actually have financial freedom. However, as someone who's never been on benefits it's a minefield. 

Any and all advice is much appreciated. 

Pippa_Alumni

Hi @martycc, and a warm welcome to the community!

Thanks for sharing this with us. Hopefully our experienced members will be in touch soon and able to offer some guidance on this.

martycc

Thank you. I'm hoping so, I genuinely don't know how the government thinks people can understand such archaic and complex rules so fingers crossed. 

poppy123456

Hi,

She needs to check if her ESA is all Income Related or part contributions based with an Income related top up. As she's been claiming benefits all her adult life, if she transferred from Incapacity benefit then it could be Contributions based with an Income related top up. If it's this then only the Income related top up will be affected by savings. To find out which she's claiming the she should ring ESA and ask.

Housing benefit and council tax reduction will stop. DLA will continue because it's not means tested. This will also be the same when she's eventually asked to claim PIP to transfer from DLA. As her age mean she'll eventually be transferred from DLA to PIP. If the PIP claim is successful then this also isn't means tested and won't be affected by any savings.

For future benefits then any savings she has can affect any pension credits she could be entitled to, in the future. This means if she gives her money away then this could affect any claim for a means tested benefit in the future and she could still be classed as having the money. For further advice on this she really should get face to face advice because it's impossible to give advice like this on an internet forum. She also needs to get further advice because it may help in the long term.

I'm afraid i'm unable to help with the pension question.

martycc

Thanks for your input. Her ESA is income based so she will lose it all and that's fine and we can account for it.
Thankfully it seems I’m on the right track. Just now need to see if the pension thing is right.

poppy123456

For her pension then she would have been receiving NI credits towards this while claiming certain benefits for all those years... like ESA for example. Checking on this website will tell you all you need to know, which you may have already done.

https://www.gov.uk/check-state-pension

What you need to be aware of as i already mentioned in future entitlement to any means tested benefits like pension credit. Deprivation of capital will affect her entitlement to this too. Further advice is needed for long term reasons also.