To think a lot of people make poor spending choices and then blame everything else?

Savings are liquid and often easy to access quickly. There are very obvious and practical reasons why they can act as an immediate financial safety net in a way that housing for example can't. Why is it better to use other people's money as a safety net when you have your own?

I also think there is an ethical question about allowing people to save money and potentially buy large assets with money that they have claimed through benefits. It wouldn't feel fair to many taxpayers and would compound the already controversial issue that many families on benefits are better off than working families. At the moment, for right or wrong, people need to come off benefits to buy the big assets that most people want. This is an incentive to become financially self sufficient and it would undoubtedly be weakened if you were allowed to save more money whilst on benefits.

That is already the case, and that amount is set at £16k. If you have that amount, you can not claim UC.
If you have more than £6k, then you get less in UC. You also have to show that you are not buying anything out of the ordinary to reduce your capital so you can claim/get more UC.

Because having people on the bones of their arse, lurching from one financial crisis to another, is going to cost the state more in the long run.

Just as an example....if I don't have a reliable vehicle, I can't work. Which means that I claim more benefits. Etc etc.

Not having decent, healthy meals and a warm home will give people- especially children- health problems. Which will end up costing the NHS more. Etc etc

But surely the principle is a person should have exhausted their own resources before turning to the state. It kind of doesn't matter if that person had been saving that money for a rainy day / house / holiday / new pair of shoes... if it's there, tough luck, use that to meet your outgoings before you start claiming.

In my case? Financial prudence, allied with luck.

Never having new clothes. Always cooking from scratch (and being vegetarian). Never having a credit card. Looking for the cheapest deals on everything. Telling the DC we can't afford this, that and the other. I am constantly astounded by how much people on MN spend on stuff.

But there's also an element of luck. Social housing, so no top ups over the LHA rate. Very low energy prices compared to most people (we have a heat pump, thanks to the housing association. Plus, a small house costs less to run).

I worked hard to build up a "just in case" safety net. Something that we are all supposed to be doing....unless you're on benefits, when you're penalised for being careful and thrifty 🙄

I remember that one too. Which would mean that the second someone is paid their UC, then they will suddenly be ineligible for it. I think some people did not realise that everything is regarded as capital, including your own UC and wages.

I have a friend who is in debt by a scary amount (several tens of thousands). Both her and her DH have an issue with spending, but they do not blame anyone or anything else at all. In fact, they are embarrassed by it and admit it is their own fault.

Think things have always been thus.

Some people are bad with money and spend it all and want handouts. Lots of people are sensible and don't. I mean there's literally bible stories about this so it's not a new phenomenon.

But the thing is when the economy changes there are many sensible people who get burned. My family for example with cost of living increases and mortgage increases and VAT on school fees (yes our choice to privately educate but still, the cost went up) whilst wages have stayed same means we've had less and less to save each month. And some unexpected things mean we've had to spend our savings. So now if one of us were made redundant (possible, both our companies are doing badly due to market factors) we'd be royally screwed.

I would say we did all the right things. Or mostly, I mean we could have lived like monks all along and not bought a house or educated privately or ever gone on holiday to save more but really where's the fun in that. I had relatives who lived that way, never went anywhere or had any fun, saved every penny, then died. Why?

But what about assets? Why is it just about savings? What about people who own their own house, or their car, or a caravan, or a valuable antique/painting, etc? Should they sell up before going onto UC? I think a relatively modest amount of savings is entirely acceptable.

About 18 years ago, I bought a 25% share in a shared ownership property with a £5,000 deposit. After living there for around 5 years, I considered selling to try and buy a fully owned home. When I mentioned it to a friend, she was keen to buy my share because the deposit requirement was relatively low.

However, after getting the property valued, I realised selling wouldn’t leave me in a strong enough financial position to move on, so I decided to stay. My friend was very upset and accused me of 'letting her down' because she was 'struggling to save a deposit'.

She had always lived rent-free with her parents, earned more than I did, and had accumulated significant credit card debt. It seemed she was blaming me for her own inability to get onto the property ladder.

Maybe but many would argue that you should use your quite considerable savings to support yourself before you come to the state. It's about personal responsibility and paying your way, otherwise everyone irrespective of savings would turn to the state and say that they can't use the £100k they have saved as they might need it in the future for something else.

Yep.

It's highly unlikely someone is claiming UC with £0 in savings and are suddenly managing a 7k kitty just because they are now on UC. It's usually due to previous circumstances before UC.

It might have been saved over 20/30 years. It might have been an inheritance. It might have been savings from during a previous period of employment. From during a marriage before it ended. It might have been sitting there for years and not have been added to in a very long time.

I agree.

I agree.

What I think could help is ending the complete over celebration of events. Let's have hen and stag nights not £750 or more weekends away, end the nonsense called 'big' or 'milestone' birthdays, and consign school proms and baby showers to history.

The observation about deposits for items not credit cards would be difficult to achieve, much as I get the point about saving.

I think the changes made in the 80s re credit have turned out to be very damaging. There was a time when you had to save a deposit to "put down" before you could buy anything on HP - it avoided the "instant gratification" and forced people to save a bit for the big things they needed credit for such as cars etc. I have a maybe flawed memory of it being something like 25%

But they may not be able to saving anything without UC? And how long has it taken to save £7k - could have been years, or an inheritance, etc? You can't have a "zero" savings rule so there has to be a line drawn somewhere, and I'd say £7k is too low, as the other poster said, it doesn't even buy you a decent van that you may need to start a business etc.

I agree. Vaping is a personal choice. Don’t tell me you’re poor if you vape. Or smoke. drink etc.

I’ve never been poor but years ago I went without treats to get through my PhD programme. No meals out, practically nothing on clothes etc. I trimmed my own hair for months. Shoes were re-soled and heeled not replaced. Our first furniture was practically all second hand. Buying new carpets because the old ones are a horrible pattern or new furniture because you’ve had enough of granny’s sofa was just not an option. Friends of ours who weren’t prepared to accept that and bought lots of stuff on credit ended up in financial dire straits. Folks need to learn to tell themselves that they can’t afford something and wait until they can. We and DS’s GF’s parents both showed them photos of our houses when we first got them as a reminder not to get seduced by ones they can’t afford. The danger is that young people in particular want what their parents have currently got, forgetting that that has taken thirty years to build.

Exactly.

I’m always surprised when I hear that some people use credit to go on holiday instead of saving first, or more generally spend money they will only receive at the end of the month.

I think alongside personal responsibility you can’t ignore the fact that people have the conspicuous consumption of others flaunted at them constantly, in a way that never used to happen pre social media.

It used to be that you might buy an interiors magazine for example. It may seem aspirational, but the people in the articles would also seem very distant, far removed from normal life. When you put the magazine down, that was it.

Now the equivalent might be that every time you open Instagram there is the temptation to disappear down the rabbit hole, the endless scroll of beautiful interiors - tens, hundreds, thousands of people all showing off their homes and their lives until it seems that this is the norm, and your own rather ordinary surroundings are the exception! Those posts will also try to draw you into other glittering worlds full of expensive clothing, holiday destinations, anything you can think of, and all of it so visible!

People will see these again and again, day after day, at times when they are feeling confident and happy with life, and at times when they are feeling vulnerable and full of self doubt.

Against that backdrop, that constant stream of messaging to convince you that life can always be wonderful and beautiful and full of so many great “things” if only you could buy them, it really doesn’t surprise me to see that have a negative impact.

Capitalism itself is driven forwards on the constant need to convince you that what you have now isn’t enough, that there is something out there that will make you happier. Social Media has provided a gateway for that message to be driven home into your brain at every hour of the day, and often late into the night.

It only takes small shifts in behaviour for that to become a real problem over time. It’s like managing our weight and health. Yes it is a personal responsibility, but it is also relevant that previous generations didn’t have to exercise responsibility surrounded by endless choice and temptation all aimed at persuading them to just relax, treat themselves, live a little!

If you're able to save £7k I wonder why you'd need UC? There may be a very obvious answer but I don't know much about it so am genuinely curious.

A lot of people I know who earn quite a bit above minimum wage would either struggle or take a long time to save that amount.

I know...But financial chaos and destitution would end up costing the state more.

Being able to save a decent amount without penalty would surely enable people to get their lives back on track.

I remember a thread about UC savings not long ago where several people believed that those on UC shouldn't be allowed to have any savings at all and if they did, they should lose their UC.

Another problem is that anyone on Universal Credit (an awful lot of people) is actively dissuaded from saving. And arguably people on benefits are the cohort most in need of getting into the saving habit!

I will need a new van at some point. It seems vans that are .new and reliable enough are coming in at £6-7000. The upper saving limit - beyond which you will be penalised- for UC is £6000. So that would wipe out all my savings, leaving nothing for an emergency.

You can see why the people on the lowest of incomes resort to bad financial decisions like getting a car on finance, can't you?

That's certainly true. But nobody needs a brand new car or latest gadgets - it boils down to personal choices at the end of the day if you choose to live outside your means and use credit for non-essentials.