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.

The OP specifically asked about UC. And mentions it subsequently. More than once. At no point has the OP mentioned tax - although others have mentioned it in passing.

Asking specifically about theoretical UC claims to the exclusion of tax is not usual. There are lots of other eventualities HNW individuals would sensibly plan for and anticipate ahead of UC and the DWP.

And if she is doing other things that she hasn't mentioned, she'd presumably ask those same advisors about her UC concerns instead of coming onto Mumsnet.

Who has a high enough NW to do the level of planning that you're alluding to (and potentially with other pots of money she hasn't mentioned) and then comes onto Mumsnet for some pointers about UC.

She didn’t say she doesn’t have other savings - she may well do. It would be in her interests to shore up financial security, yes, but I’m not going to assume she isn’t already.

Posts she has made make it pretty clear she does not have other significant savings as she has prioritized the school fund, and at a basic level her question about UC eligibility makes waaaay more sense from this perspective.

I am not sure why you are so determined to suggest that she’s actually financially fine when she hasn’t said anything to suggest she has other savings despite having lots of opportunities to make that clear. It’s pretty apparent that she perceives there’s a good enough chance she will end up on UC that it is the whole focus of her original post.

This 💯

The bottom line is there are all sorts of reasonable reasons to want to ring fence this money; new marriage, protection upon death/estate planning, not wanting child to have access to it upon reaching majority, protection from lawsuits (personal liability), protection from being spent by the parent (OP might have a closet gambling problem), just to name a few.

If we take OP at her word that she has no immediate need of UC then it’s very unlikely to be an issue. If she does have immediate plans to apply for UC then she’s fucked anyway because that money is likely to a consideration due to timing and all of this is a moot point.

If the worst case happens the OP won’t get UC but her child will still get her education.

The most likely scenario is that the OP never loses her job or gets too sick to work and everyone lives happily ever after. The next most likely scenario is that OP has a short stint of unemployment at some point in the future and collects UC for a short time after the determination is made that ring fencing the money was reasonable at the time to do and her child’s education isn’t disrupted.

People who claim UC aren't in a position to pay for private education

They are if they plan ahead and ring fence the money.

Posts she’s made have also been clear on the fact that she doesn’t intend to claim UC.

What I’m saying is that I don’t know, any more than you do. OP hasn’t said that she does, but nor has she said she doesn’t. As such, I’m not going to pretend I know and speak on what I believe to be true rather than what she’s actually said.

Which is unfair to say the least

That’s your opinion.

Let’s play a little thought exercise shall we.

Bob and Mary are happily married with a 3 yo child. Like responsible parents they go ahead do estate planning that includes setting aside 200K for little Terry’s education in a trust fund so if anything happens to them little Terry can still go to private school. Bob and Mary are conscientious tax payers and are both working in good paying roles.

2 years later 5yo Terry is happily attending school, Bob and Mary are still happily married when tragedy strikes. Bob is hit by a bus and killed.

Mary keeps it together and continues to support herself and young Terry.

2 years later now 7yo Terry is still attending private school when Mary is made redundant from work. Mary applies for UC while she takes a short course to get certified to help her get a new job.

4 months later Mary has a great new job 7yo Terry is still doing well in school.

Still unfair of Mary to claim UC?

Yes

I guess it’s lucky for our fictional Mary and Terry that @Bachboo isn’t writing the laws.

Hahaha. Nope. Not me! I believe there is some kind of MN sub Reddit. But Im not 100%

People like @Bachboo would prefer no incentive for anyone to bother to save for anything. No point is there? May as well rely on the state from the word go. Like lots do….

Absolutely eh? 😂

lol, way to radically distort what people have actually said.

Putting up straw men to knock down is the last resort of people who’ve realised their argument is flawed.

'May as well rely on the state from the word go. Like lots do ....'

Nice bit of shaming of people on benefits on your own thread where ironically you are looking for ways to be able to claim benefits without having your £200,000 savings being taken into account.

Some people do have to rely on the state. The people who universal credit is for.

Your entitlement and superiority over universal credit is staggering.

if only everyone was as hard working and financially savvy as you, eh? So unfair you have to put your savings in a trust fund to make sure you get the UC entitlement you deserve should you lose your job. Poor you.

@saltinesandcoffeecups yep still unfair because if they had the kind of cash to be wacking £200k in to trust funds and had good jobs then they sure as hell had the cash for Bob and Mary to have pretty hefty life insurance policies!! Meaning mary kept Terry at school, did her course and used the cash she had for a couple of months . It's unlikely she suddenly had sod all in that situation .

So I've just had a quick read of that particular thread. It appears that there is one poster who claims to be a former DM who is talking about a specific type of trust.

It's interesting that what this person says is directly contradicted by the guidance given by the DWP in the advice to Decision Makers:

ADM Chapter H1: Capital (publishing.service.gov.uk)

Ownership of capital of a child or young person

H1077 Capital owned either legally or beneficially by a dependent child or qualifying young person is not to be included in the capital of the claimant. However, the DM may still need to make enquiries about such capital if it appears to be owned by the claimant but is actually beneficially owned by a child or young person for whom they are responsible.

H1078 Children and young people may not be the legal owners of the capital of which they are the beneficial owners. This is because businesses, such as banks, will not enter into a contract with them. If they are the beneficial owners and not the legal owners their capital will be held on trust by another person.

Universal Credit Decision Makers (DMs) will look at the overall situation to see if you have done anything that may be described as "deprivation of capital".

If, all of a sudden, you open a child savings account just as you are made redundant and transfer all your savings into it then they will likely count that as deprivation.

In contrast, if you were to open a child savings account today and regularly pay money in to the account each year then, if you did go onto Universal Credit in a few year times, and you paid a similar amount into your child's savings account at that time then you have not changed your regular behaviour so it would be difficult for them to prove that it was done for the purpose of claiming benefits.

But any money that goes into the child's savings account is held on trust for the child. If you wish to take money from the account then it must be used for the benefit of the child. This can certainly included things like paying for private education.

The onus of proof is on the DM to prove that the claimant’s intention was to increase or retain their entitlement to benefits.

No I prefer for people not to cheat the benefits system, like you want to do

It’s quite simple really. I and countless others don’t like benefit cheats.

Exactly.

@Bachboo how is using a legally available option, cheating? Can you manage to explain that through the wrath of your bitterness?

"The bottom line is there are all sorts of reasonable reasons to want to ring fence this money; new marriage, protection upon death/estate planning, not wanting child to have access to it upon reaching majority, protection from lawsuits (personal liability), protection from being spent by the parent (OP might have a closet gambling problem), just to name a few."
@Saltinesandcoffeecups

Nobody is saying that any of these things aren't reasonable things to plan for - quite the opposite, in fact.

But the point is that ahead of all of those things, the OP is primarily concerned about ring-fencing £200k from the DWP so that she can claim UC.

And the people who are pointing out the ridiculousness of that are somehow the unreasonable ones.