Universal credit savings

[Jellywithyogurt]

So I have well over 50k in savings. I'm not bragging, it's our house deposit fund for one day when we can afford to move out of council. We don't touch this money.
We get tax credits and are about to move over to UC.
Would I be unreasonable to not even apply. Since I have over 16k in savings. Am I getting it wrong? I am reading that we no longer qualify.
Yabu - apply
Yanbu - don't bother, you don't qualify for it anymore

Also UC will pay your housing costs (up to a limit anyway) if you are a renter, but nothing at all if you have a mortgage... they used to previously pay the interest but not the capital which is fair enough, but now they will only give it as a loan, so in this regard renters are better off.

True. But, the point is that a home owner has an asset which contributes to overall wealth. A renter doesn't. Rent is usually higher too. Renters have fewer rights and are often exploited. Also, it's the landlord who gets to keep the UC rent part, not the claimants themselves.

@anonhop can you please get off your high horse or should someone come along and pull you down from it? Life is like a cog and you need people at all different levels. Even people on min wage pay tax also. Is that really hard to understand that you always need people lower down we can't just have a world full of mangers, CEOs... FGS!

You don't gain £300 a month by having an extra £300 a month disregarded for UC, it's 45% of £300, so £135.

It may not cost £135 a month to keep a house going, but averaged over the years I wouldn't expect it to be an awful lot less. My annual boiler service cost almost exactly that, and the buildings insurance premium will be about the same again, and that's without anything actually going wrong.

The boiler had to be replaced 18 months ago year at a cost of £1300-ish (the old one would have cost £1500 to fix), new windows and doors in 20/21 were £13k. The year before that, refitting the bathroom was approx £5k all in. The kitchen is 25 years old and badly needs replacing, that will be 000's, and the drive needs resurfacing. I had to have the kitchen tap replaced and a leak fixed towards the end of last year, that was over £100 each time. And that doesn't include any redecorating (I used to do that myself, but am too old and arthritic now). My NDN's fence came down last winter, and replacing it was thousands. I was so glad it wasn't mine! It's only a small, 2-bed semi, but there always seems to be something.

I do tend to agree. The average amount of savings held in a UK household is around £18k (source unbiased.co.uk) so the £16k limit for benefit claimants seems reasonable, if not generous, to me. On average those under 55 have less than £15k; between 35 and 44 the average household savings are just £6,750

https://www.unbiased.co.uk/discover/personal-finance/savings-investing/what-are-the-average-savings-by-age-in-the-uk

Sorry, I didn't mean to come across as "I'm better than people on benefits". Not at all. 100% support the benefits system & actually think it should be more generous for those who really need it.

My point (which I clearly didn't get across well), was that benefits shouldn't be used to top up a lifestyle to enable a person to amass savings.

I totally get that we need people doing all jobs & tbh think minimum wage should be higher etc. However, if you want a life as a homeowner, ability to save money etc, then I think you need to choose a career that will enable you to have that lifestyle.

It's more that benefits should be a last resort, not a top up.

do you really get a housing amount on uc if you are mortgage free,i thought it was only paid if you rented

im being moved over from esa in the summer / autumn and as i own my house outright just in my name i wouldnt expect to get any housing help

Sorry didn’t mention before it’s the working element. It’s not 45%, you lose 45% of your earnings after that. So yes, if you’re working and not claiming the housing element you are 250ish better off. (Not 300 like I said before).

@anonhop you seem very misinformed about benefits. All I will say is you must be living under a rock or something you don't seem very well rounded for an adult to me. Don't you read all those women on here that have given up their successful careers and started a family and then sudden it's all gone wrong. People can not just retrain and AGAIN someone has to serve you in M&S. Honestly your attitude and outlook on life is very black and white...

I entirely agree about tenants' rights being appalling, and LLs doing very nicely out of the benefit system. I work in welfare rights, and rent is invariably the single biggest element in almost every UC claim I see.

And while it's equally true that owning a home increases wealth, for anyone who ends up needing to go into care, the house will end up paying for most of it. Those who don't own a property will have those costs covered by the taxpayer.

However, if you want a life as a homeowner, ability to save money etc, then I think you need to choose a career that will enable you to have that lifestyle.

Shouldn’t you just! But unfortunately, in reality, once you’re on UC that’s not a realistic opportunity for most. Maybe under the next government?

In your situation on UC you would not get a rent element. However if you had a partner on your claim who is working then you would get a work allowance ( because you would qualify for LCW or LCWRA depending what ESA group you are in. This means if you or your partner worked on UC you would get a work allowance meaning a proportion of your earnings is disregarded before deductions for earnings come off your award. When you have no rent element this is higher. So in your situation if you had a joint UC claim with a partner and they worked you would get £631 disregarded from their earnings, making you as a couple a lot better off on UC. If you were renting this work allowance would be significantly less. This is where people with a mortgage or who are mortgage free or living with relatives will benefit.

I don't think that's really fair as I have apologised for how it came across. I think you're looking to be offended.

I entirely understand these situations + have repeated that benefits should be available for people who genuinely have nowhere else to turn to. For these people, benefits should be a liveable amount (higher than what they are now, from what I can tell).

My point was simply about having lots of money in a savings account & instead of using that to support yourself while you retrain/change your circumstances, wanting to claim UC and keep the savings steady.

As harsh as it sounds, this country isn't rolling in money at the moment. OP should use her £50k savings before using £50k from the public purse, in my personal opinion. Don't make me out to be a monster.

Agree to an extent + for many people. However for OP, she could use the £50k to retrain & support herself while doing this, instead of using UC to essentially purchase a house.

See I disagree with that. She’ll use that money to retrain, get an entry level job, get stuck with high rents and still have to claim UC to get by in a house she’ll never own. Things will never get better for her. Buying the house then retraining limits the tax payers money being spent on her and halts it way sooner then the former option.

Universal credit is awful for students. It penalises people trying to better their situation and I am so thankful I could get my qualifications as a single mum before it came in. I work in HE and we have record numbers of people seeking help for stress, mental health issues and money problems. Universal credit is a common theme.

That's correct. If you have savings of £16,000 you are no longer eligible for UC.

How on earth do you need tax credits in the first place if you can save that much?

As others have previously mentioned, I think that savings over £16k are disregarded for a year. I am in a similar situation but have a property which needs many repairs, damp proofing, no radiators in a lot of the rooms, no tiles in the bathroom and everything needs replacing, new floors as they had to be pulled up due to woodworm, I could go on. The savings are to carry out this work and are a result of my partner dying and leaving some life insurance. There is no disregard for this but if we were divorced, child maintenance would be disregarded.
I do agree that it kind of traps people.
Also, I helped someone apply recently and they will want to know every single bank account that you have, who it’s with, how much is in there and the last digits of the bank account. It may be worth doing a benefits calculator, putting in savings of £16k and see what you may be entitled to under Universal Credit.

As a tax payer you should be pretty peed off with the fact people who own and have equity in their homes or have their money in assets like expensive cars etc can claim top whack. It's a messed up unfair system

It's not £250 it's £135 like the pp said.

aha. Well the above is from citizens advice website, they must have it wrong.

They're not wrong. They're just talking about it differently.

The allowance for a working person responsible for children or having limited capability for work, is £379, if you rent. If not, it's £631. That's a difference of £252.

Edited because I'd got myself muddled.

The bottom line is that you're always better off working than not working, and although renters get more support, they have nothing to show for it at the end of it all.

I could have been really unclear but what they are writing about is what was trying to say. The taper rate for those claiming Housing costs starts after £379 for those not claiming it starts after £651.