To ask how I can successfully ringfence this money? (Please don’t post for moral judgement)

[Jaalp]

I am a single parent to a 3 year old who will start school in the next two years. I have saved up a significant amount of money for schools fees. As a single parent I am constantly worried about job loss or anything else that could affect things. I am aware that if for some reason I was made redundant, for example, if I have more than a certain amount in savings then I would be expected to use this before claiming universal credit etc.

I have no intention of claiming universal credit but life happens and I have to be conscious of the potential things that could happen.

My question is, is there any way to put this money in an account for my child that would be protected as theirs and not counted in an assessment for universal credit etc should that ever happen?

Please don’t make this is a private school bashing thread or about playing the system etc. I’ve worked hard all my life and intend to continue to do so. Thanks.

If that was the case you would have enough in savings to know you can provide for yourself and DC whilst affording school fees, should you lose your job. This is not about you making more sacrifices for your DC, it is about having your priorities wrong. Your DCs comfort and safety shouldn't be something you are willing to gamble.

Because private school is a complete luxury not a necessity!
UC is meant to ensure people on a low wage have enough money for their needs eg rent, food etc. It is not a stop gap for those with the funds for private school.
If you are genuinely concerned that you could not make ends meet in the event of losing your job, I’m afraid you probably can’t afford school fees.
I’m a private school parent- the additional costs are bloody endless so be very careful of expecting the fees to be your only cost.

How is it theft? Putting money in the trust fund means it’s no longer mine and can only be used for my child in the way prescribed. It’s not me spending 200k on myself then claiming UC.

That it may become illegal in future, which is incredibly unlikely, is irrelevant. What she’s doing is legal, and by definition is not stealing.

Your moral issues over it are your own problem, and have no bearing on what OP is free to do.

@Acommonreader it may well be luxury but not a luxury for my benefit. As I said.

Honestly this place is loopy loo. It’s a simple matter of setting up a trust for educational purposes, completely common and straightforward where the OP is “gifting”. What about the tax she has already paid? Or the fact that she hasn’t claimed any benefits?
OP could go to Vegas and blow it in a weekend, is that fraud? Unbelievable.

Yes she is. She's expecting the taxpayer to fund her benefits while she's playing the system by hiding money to finance luxury educational provision for her child. If it's legal it stinks.

@MuchasSmoochas people are ok with blowing cash on cars and holidays, not so much on education! I am proud I have saved for my child and haven’t chosen to live a flashy lifestyle that I could have done instead. 😊

It is isn’t stealing and it is legal. That you think it shouldn’t be legal and should be classed as stealing is irrelevant - OP asked if there’s a legal way to do what she wants, and there is.

When it’s my taxpayer pound that supports this I have every right to have my opinion on it. It is your attitude along with that of the op that is everything wrong with the UC system

@Jaalp, I created this username ages ago for a vaguely similar discussion! A discretionary trust fund is the sort of thing you're looking for, and a solicitor or IFA should be able to help you.

I know that you're taking a lot of flak for your post, but you did put it in AIBU. On some other boards, like Money Matters, this is positively mainstream (especially if linked to inheritance; you're worried about job loss, others are worried about sudden death).

Because you'd be happy to use other people's taxes to facilitate it. And it is to your benefit because it's a luxury you want for your child.

Absolutely; it's what rich people do. They find ways to game the system so that they pay less than their fair share. But, as I say, this is the first time I have ever heard of a rich person being so grabby that they want to find a sneaky way to claim benefits.

You do you...

This amounts to the same thing when it comes tk the taxpayer funding you though. You're still spending it on luxuries either way - I can't understand how you're not getting this.

She doesn’t want to get it

Jeez we have a single mother wanting the best for her child, the horror. Would love to know how many of the nay sayers are claiming universal credit. But that’s not cheating, that’s an entitlement.

If it's legal it needs stopping. As pointed out above legal doesn't mean ethical. It's leeching off other people's taxes.

Good luck on getting it sorted OP, it really shouldn’t take too much. I’m glad this thread has been useful, even despite the frothing.

As an aside, it’s always a good idea to take financial advice when you have assets imo, and probably wouldn’t be a bad idea to consider what else can be done to your benefit.

@Bachboo if you think buying a 100k car is the same as buying education you are a very sad person. Education matters. Flashy cars do not.

Thanks, appreciate it. 17k is total savings not deposit. Sounds great on paper but not realistic. What about an emergency fund and moving costs? Full time nursery fees plus mortgage repayments, plus moving away from my support network. I think you'd need double that as a deposit. Also factor in the pay cut from moving outside London...it's just not feasible.

I think the tax burden of a trust would outstrip the benefit. Trusts are taxed at the highest rate on assets and can only tax pool when the settlor is not a parent, so taxes would dent investment performance. If you went the traditional route of a Bond in a trust to mitigate taxes (and the necessary accounting and SATR) then the disinvestment restrictions could be problematic as it’s reactive rather than planned, but it wouldn’t be without merit.

Traditional school fee planning solutions are held in the parents name, not the child’s.

I would invest the money and assume that (unless you are in a very niche job role.) that the growth achieved in ISA’s and a GIA would outstrip performance and pay more than UC.

Honestly OP I think you’re overthinking this and some financial planning would be better.

I’m a Chartered IFA and do lots of school fee planning.

Write a strongly worded letter to the editor or something then.

Ethics aside, how have you not just Googled this?

What are you talking about?. The two things are not the same at all. I’m beginning g to worry about your comprehension

@InterIgnis thank you! The ridiculous part of this is I absolutely would hate to be on UC. I’ve always worked and been careful with money and never so much as stolen a penny sweet! All I wanted to know was if I could protect my child’s future with the money saved for these fees… this thread really does highlight how people view education though, sadly.