The mother of the youngest serving British soldier to be killed in Afghanistan was told on Armistice Day her income support had been stopped.
Lucy Aldridge, a single mother-of-three from Herefordshire, was left unable to work after a work accident in 2003.
She then lost her eldest son William, 18, in a bomb blast in July 2009 as he tried to rescue some injured comrades.
The Department of Work and Pensions has said her son's death-in-service payment now makes her ineligible for benefits.
Rifleman William Aldridge was killed while trying to rescue his comrades from a blast in Sangin in the province of Helmand.
His mother received £66,000 paid to the next of kin for British servicemen who die in service.
She found the letter from the Department of Work and Pensions on her doorstep after returning from an Armistice service in her home village of Bredenbury on Thursday.
She said: "I was probably at my most vulnerable yesterday.
"I was trying to deal with all sorts of emotions, not just for the loss of my son but for my friends who have lost sons in Afghanistan and I was trying to deal with what it meant for his little brothers as well.
"To come home and have this letter waiting for me I just think it was so incredibly insensitive."
The Department for Work and Pensions said in a statement: "We are very sorry that this letter arrived on such a sad day and profoundly apologise for any distress caused to Mrs Aldridge."
It said anyone with capital of more than £16,000 was ineligible to claim income support allowance.
Mrs Aldridge said she had put a lot of the lump sum into the William Aldridge Charitable Foundation to help injured servicemen.
The rest she was investing for her younger sons' futures.
"I've never taken anything from this country that I'm not entitled to," she added.
"My world was turned upside down the day my son lost his life, he did so extremely bravely in saving other people.
"He was a selfless person and he was brought up that way by me as his mother.
"I don't want to air my dirty laundry, but I need to highlight that fact that there are people who do struggle in this country and I've been one of them."