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.

It will be earlier actions if there indeed comes a time in the future where she’s unemployed and needs UC, having depleted her own savings.

She doesn’t anticipate this happening, has no plans to claim UC, and is financially securing herself in addition to securing her daughter’s education, but she’s being sensible in considering all eventualities as part of her financial planning. That planning ahead may not work out because you can’t guarantee against all risk, doesn’t mean that it isn’t in your interests to plan ahead.

If the OP hadn't brought UC into the original question and 'how can I stick money away so it doesn't affect my rights to claim UC' then I have no issue with wealth planning although I do think the obsession with private school is annoying . The fact is though she did bring claiming UC into the equation and hence shouldn't be suprised at the comments.

If you have got £200k in the bank you could draw £15k a year fees out of this for quite some time plus living expenses and I'm presuming if you are this high an earner would be able to get another decent paying gig in a reasonable frame of time. That's what normal high earners would be doing and then if still out of work deciding after a few years what to do about the school.

Lots of people do have trust funds yes, but they aren't usually in the situation they are also in the same breath looking at whether they can claim UC down the line and making trust fund decisions based around that. They usually have other assets to call on if in that position- 2nd homes, other cash in bank etc- now it may be the OP has other cash to call on besides the school frees, but if so why even mention UC? As further cash of a decent amount would make her ineligible anyway- as well as having locked away easy access to trust fund cash. It sounds like bullshit to me-

I appreciate that, but she's talking about how to avoid having to use her own savings to pay for her own living costs. Most of us have been there- people put aside some money for a holiday or a birthday party or nice present for their child, the the boiler breaks or there's a storm and the roof needs repairs, or we get made redundant and luxuries are off the menu for a while.

A child in private school is a luxury, even though parents may have to make selfless choices in order to afford it.

Currently, she can afford it and that's great, but if she needs to spend savings on covering an emergency or living costs, then she should- not continue to spend money on a luxury and have the state cover her living costs.

@Willyoujustbequiet why would I want to be on UC rather than how I currently live? That would be a very odd assumption to make.

The OP doesn't have to justify herself to me or morally defend it. She can do what she wants irrespective of my opinion. I also acknowledged that what she was intending to do was legal.

However, she has posted in AIBU and I think she is being unreasonable and morally wrong. This board invites people's opinions and I have given mine. Legal doesn't always equal morally right.

No, she’s talking about not using an amount she has ring fenced specifically to fund her daughter’s education - she didn’t say that the £200k is the entirety of her savings.

She doesn’t intend for the state to cover her living costs.

Sure, and those opinions can in turn be commented on.

Legal means we have the freedom to make our own moral judgements and act accordingly.

It's not her plan, but she wants to think it's an option and morally, you shouldn't be able to claim benefits whilst your child is at private school.

As I've explained, we all have things we'd like to do for our children. We do them whilst we can afford to do them. When we can't afford them anymore, we stop. If you need UC to survive, you can't afford private school.

OP can pay for private school now and hope things don't change, but she needs to accept that circumstances change and the money she wants to spend on this may possibly need to be spent on living costs if she has an emergency.

There used to be a thing called Assisted Place scheme. Where people who's parents were broke and the government paid for the whole of the kids private school career from 11-18. If that still existed and your kid was able to pass the exams then that would have been an option.

Because it is an option, in the unlikely event that it will ever happen. It isn’t merely the case of OP wanting to do this for her child - she can do it for her child.

Plenty of people, with the means to do so, do exactly what OP is doing as part of their financial planning, ensuring that they can afford security for their children in the event of unanticipated and unlikely to happen financial hardship. She hasn’t said that she’s putting all her money in her daughter’s name, or that this is the only security she’s looking to acquire with no thought as to anything else.

That you have a moral issue with it has no bearing on OP and what she’s able to do.

@Jaalp so by now you’ve realized that mumsnet is not the place to ask this question… Sadly there is a lot of shockingly bad information here regarding personal finances. There is also a zealot faction of the morally superior that is almost puritanical in their rigid thought process. I’d suggest a money focused forum.

@InterIgnis if she doesn't intend for the state to cover living costs then why mention UC at all ??

Why get contents insurance if you don’t intend on getting robbed? Or put on a seatbelt if you don’t intend to crash?

Because as part of financial planning it’s sensible, normal, and indeed explicitly advised, to consider all eventualities, even unlikely ones.

@saltinesandcoffeecups the thing is and I'm sure I'm not alone and I'm no hardened lefty either - I really don't care if people are stinking rich or just well off- lucky them , have a good life on it- if the OP had said she had come into some money and wanted to maximise it for future use for school fees and minimise obligations for tax I would have some understanding and yes that's common practice and I suspect many of us would do the same in that position- but the OPs first thought was it affecting a UC claim , which is simply 'taking' money out the public purse. Any normal person as I said below with decent assets and cash at hand would realise that they use their cash including fees until such a point where they need to rethink private school. UC wouldn't come into it initially for a pretty long time- if she has this much cash to stick away regularly maybe get a decent income protection/critical illness policy and up the life insurance- not think how you can hide substantial assets away from the DWP - but as it happens I don't think we are getting the full story.

@InterIgnis I think it's big risk using your cash for trusts on the basis that they will be discounted when it comes to 'claiming' - and what if they tighten rules on trusts etc that the money cannot be withdrawn at all till 18 etc- that would render it pointless for the OP in terms of fee paying.-- if the need arises- Rules can and do change frequently with DWP

@Crikeyalmighty Fair enough… but if the answer and tone would be different if the OP had come in with the question “how can I ring fence this money because I’m getting married or whatever’” then it’s just bias.

I’m as right wing as they come and don’t see any problem with what the OP is trying to do. It’s, quite frankly, very smart to plan for as many eventualities as possible.

If the OP had come in saying that they want to ring fence this money so they can quit their job and collect UC then yes… that would be a different matter. Odds are the OP will gainfully employed and contributing to that public pot for the duration of her child’s education.

Far too often people make financial decisions based on emotion rather than logic. The OP is 100% doing the correct thing by asking questions, playing the ‘what if’ game, and planning for the unlikely.

They won’t automatically be discounted at all. Yes, there’s a risk of course (as there is with anything), but there’s a difference between a big risk and a small one. Additionally, potential downsides have to be weighed against the potential benefits - which one outweighs the other is dependent on many factors, including personal judgement. That you wouldn’t take the risk doesn’t mean OP shouldn’t.

Op can already choose to do that with a trust if she so wishes. It is extremely unlikely that any government would ‘tighten the rules’ and introduce such a thing to apply to all beneficiaries under the age of eighteen, given that they too are obliged to act within the law (and no, they can’t just change the law), not least because it’s not in their interests to do so.

It’s not logical to ring fence your entire savings for one purpose “school fees” and not have any savings for other eventualities. The fact OP is only talking about school fees vs UC suggests she has no other plan were she to lose her job. It’s quite a leap to be concerned about it if, for example, she had six months worth of income set aside and/or a good policy for income cover.

I would go as far to say the OPs position on private school savings above all else is the emotionally driven decision.

Private school parents really haven't been covering themselves in glory recently in posts on MN...

Which is I why I advised this in my first post in the thread;

1. Sit down with a fee only financial planner to discuss investment options for this money.
2. Sit down with a tax advisor to do the same
3. Ask both the same question that you asked here.
4. I would also make sure you are saving for things like a bout of unemployment, retirement, day to day living.

Have they? Have you seen some of the juvenile comments from the ‘you’re cheating the system’ brigade?

She didn’t say that £200k is all she has in savings - she says that’s what she has set aside specifically for fund her daughter’s schooling.

She also didn’t say she had no other plans should she lose her job.

But asking Mumsnet what to do instead of paying for a proper financial advisor is one of the clever savings hacks that has allowed the OP to sock away the price of a small house in just a few short years 🤣

If that were the case it would render the entire thread rather pointless, wouldn’t it?

You're free to disagree but it's not very civilised to insult others' opinions like that.