To think Child Benefit goes into the family kitty?

[summerfish]

I was talking to a friend yesterday, and she said that she saves all of her child benefit in a special account, which she will give their children when they are 18.

I have never done this at all! Child benefit goes straight into an account which my husband and I use for family expenses. Also I have no idea how this would work practically, as the first child would presumably get a much larger slice of the pie, owing to the fact that the second child gets less CB! Not to mention, the fact that I have to pay my child benefit back via my self assessment in any year that I earn over a certain amount.

AIBU To think that child benefit is to be used for every day expenses?

I have saved or used ours on a monthly basis depending on our current situation (we’ve had periods of job loses and then two well paying jobs and everything in between).

At the moment I am splitting the monthly CB payment in 2. DC1 has a huge amount more than DC2 as I saved all theirs in the first 2 years before DC2 came along. But then DC2 will have 2 years left after DC1 turns 18.

We used to save it but now we earn to much

It technically goes into the joint account so is spent on household bits and piece but we do put money in DS savings amount each month

This thread makes it clear that the means testing doesn’t work.

I’m at the point now where I need to be watching bonuses, pensions contributions etc now not to be paying it back with a base salary of 50k as a single parent. But people in comfortable dual income households can afford to save it as it doesn’t look at household income.

@maddiemookins16mum

You could argue that if you really don’t need it for weekly living expenses, then you really don’t need it.

You could, but it would be ridiculous.

I mean, who defines need? My kids share a room, thus my mortgage is lower than it would be in a bigger place. Someone on the same income as me, or more perhaps, who decided on an extra room or just a slightly more expensive house can have the extra £140 a month because of the choice they made and come out at the end with a more expensive asset, because their monthly bills are higher? Excellent way to discourage saving and motivate people to put all their financial eggs in the property basket.

Equally, my household eats meat and also lots of fish, the latter being particularly expensive. Our food bill is going to be higher than a veggie family who uses pulses where we have meat. Some people shop around for the cheapest tariffs, contracts etc, others dont. Again, what amounts to 'need' in this scenario? Perhaps I'm using the child benefit to buy expensive berries my DC loves when pears would do fine and cost much less per kilo. Maybe I love aldi but the woman over the road doesn't want to shop there even though she knows it'd be cheaper than Sainsbos, but she hates the tills. People can be making all kinds of choices that lead to substantial variation in basic expenses.

It depends on your financial circumstances. I have friends who do that. I knew a couple of families that would save it up to contribute to family holidays. Mine went towards child care because those were our circumstances at the time.

We invested ours in a pension scheme for our DS, he can't touch it until he's 55!
Agree you can't really define 'need' ... my DB complained that his CB stopped a few years ago when the rules changed & he was finding things 'tough' without it, so I know his household income is clearly a lot higher than our's - but they love 'spending money', nice holidays, new cars, latest tech etc etc.

I know at least two people who have been overpaid as salaries have increased and had to pay back at least a years worth of savings, that they had put 8nto accounts for children. Definitely worth checking you are eligible to avoid this scenario. There was no negotiating, it was an overpayment and had to be repaid, or clawed back via tax.

It’s all about priorities. I think what your friend is doing is a great idea. However if you literally can’t afford it there’s nothing you can do.

@Mintychoc1

Now that it’s means tested, I think if you can afford to not use it then you shouldn’t be getting it. It’s meant to go towards the costs of raising a child, not be a savings plan.

What somebody chooses to spend is their business. Also everybody’s bills differ due to someone may have Sky and somebody may not. Somebody may shop in Aldi and another family may shop in Morrisons.

Let’s pull together and not against.

@SplunkPostGres

What you say might apply BUT there was a poster that uses TC for school fees and saves CB and is on a low income so wiping your claim of a single person on 50K needing it right out.....

I guess it all depends on expenses/lifestyle etc... To some 50K is huge to you, CB should be paid.... Others can save on much less. It is interesting to see how many people on this thread save the CB though.

I used to work in finance. There appeared to be no rhyme or reason to who could pay their debts and save and who couldn't. Many a high earner struggle to manage their outgoings and many a lower earner saved a bit... anyway to anyone struggling ... there are lots of good tips out there.

Ours goes in a savings account for DS. I dip into it often but have tried to not spend any for the next three months.

I'll then buy about £100 of premium bonds with some and there will be enough left of what I've saved to get him a new bed. I don't manage to save the full amount every month and there is rarely ever more than £200 in his account. However I find that by keeping it in a completely separate pot I know the money is only ever spent on him. When DC2 comes along I'm planning to get them their own account and the s split the money 50/50 as you obvs get a slightly less for DC2

When I was a teenager my friends DM used to give my friend the child benefit and my friend used it for buying clothes, treats for herself etc.
Friends DM told me it was money for the child so I should go home and tell my DM that she should be giving the CB to me as legally it was my money.
Let's just say that conversation with my DM didnt end well for me
When I had my own DD the CB was put in the family pot

@nowaitaminute

That's strange that each child doesn't get the same amount in the U.K.!! Here in Ireland we get 140 per month per child and it's not means tested either!! But yes I save mine for my dc. My 7 yr old already has 11k and my 4yr old has about 8k.

That’s a huge amount. Per child I’d be saying too!

@peachypetite I already save for her future and the child benefit money is used to buy clothes she wants and means I don’t have to give her pockets money. She’s 16 and does spend it wisely.

Why does it matter to you?

Mine all goes into a savings account for my kids

My daughter’s went into a savings account.

Tax creditss, family itty ca my kitty. (Probably spent on food for family tbh.)

i get over five hundred a month and save some of it but not all.

We save it for the kids. I would use it though if we got to a point where we needed it.

Frankly, it baffles me as to why (some) people are given child benefits at all when they clearly would do just fine without. The key is in the name, isn’t it? It’s called child benefit, not ‘help my adult offspring buy a car or put down money for a house’ benefit.

Maybe it's time to lower the income threshold if being able to save the whole lot is apparently so common. 🤷

Ours goes in to the family pot - I would like to save it for DC but unfortunately we are not in the financial position to do so atm

We save it to be spent on swimming lessons, clothes, nappies etc. Basically anything our little one needs if we don’t have the spare cash in our general spending money comes out of his child benefit savings. Some months when we’re tight we have to just let it roll into our monthly spending but I feel bad when this happens :(

Ours is used on family expenses atm as we have a little bit of debt that needs paying and I will also be on maternity leave again in a few months, but once I am back to work I intend to save it each month and then 2 or 3 times a year when both kids need new clothes and shoes i can use that money. So it will be spent on them, just on things they need. I do have a savings account for my daughter though and try to put in a fiver per week and my mother also puts on a tenner a month. So I will do the same for my son once he's here