Ask Paul: Will I lose my disability pension if I inherit $100k?
I'm currently on a disability pension and live in public housing in Queensland.
My mother recently died and I may inherit around $100,000 (unsure of the amount, as awaiting probate). I don't work and have no superannuation.
My assets, including my car, furniture, etc, would be worth about $10,000.
I'm terrified that I'll not only lose the disability pension but will get kicked out of public housing.
I do intend to prepay my and my son's funeral, cremation plots and plaques. What do you suggest, please, so I keep my housing and pension?
I understand your concern here, Beverley. I need you to call your Queensland Housing Service Centre to discuss your personal situation, but reviewing the Queensland public housing information, I do not think you will be about to be ejected from your home or lose your pension.
Let's assume you do get $100,000, with your current $10,000 in assets. Looking at this logically, while it will be a wonderful help to you, it will not put you in a position to buy your own home, and the returns from investing it of around $5000 a year hardly make private rental possible.
In Queensland, eligibility for public housing is that you earn under $609 a week and that you don't own or part-own a property. A single-person household in public housing can have $116,375 in assets - you would be below this amount.
With your disability pension, I also do not see an issue. If you invested the $100,000 in a term deposit at, say, 5%, that would give you a bit under $100 a week.
But you are allowed to earn up to $102 a week before you lose a dollar of pension. When it comes to assets, you do not lose a dollar of pension until you have above $543,750.
If you do receive $100,000, clearly for both social housing and your pension, your circumstances will have changed, so you should advise both.
But my read of the relevant rules indicates that it will not impact either your home or your pension.
What you should do is to ring both your Housing Service Centre and Services Australia, or pop into their offices and check, but I am quite confident that the amount you are likely to receive will make your life better but not impact your home or pension.
Finally, be careful with prepaid funeral plans. Some of them can be a dreadful ripoff.
Ensure you deal with a reputable funeral provider and do check the fine print. All too often these prepaid plans do not deliver the funeral you were expecting. Take care!
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