To wonder why the UC savings threshold is £6,000?

[GiddyLurker]

Why is the Universal Credit savings threshold set at £6,000? What’s the reasoning behind that number?

It feels quite specific and I just wondered whether there’s a particular logic or policy decision behind it?

Cost of a funeral plus a few debts. The imputed income between 6k and 16k is so harsh that effectively the limit is 6k.

What a horrible post. I had to justify a £5 Vinted refund.

Which is exactly what l’m saying. If a claimant stopped renting and bought a home, the state, in the form of UC, would no longer be responsible for paying towards their housing as there are no benefit provisions for help with mortgages. Therefore that would represent a saving for the state.

@anyolddinosaur yes there aren't many accounts that pay the kind of interest universal credit reckons you get on savings, and subtracts from you.

Being able to save for a house deposit could for example help someone into a shared ownership property where they could buy a share of the property. They could still claim UC rent element to help with the rent part. Over time they can then purchase a bigger share of the property and ultimately own it thus meaning they don't need to be reliant on UC or housing benefit ( when retired) long term. It's a good option in some circumstances where people perhaps cannot secure a full mortgage.

A quick google says otherwise. There are plenty of investment and savings account that offer the equivalent, which is roughly £20 for every £1000 saved. It’s around 2% per year.

I think it should be 99p…. Why subsidise someone with £6k in the bank?

The poster clearly doesn’t know what they’re talking about. I’ve worked within the system and UC claimants are routinely reviewed after submitting bank statements. Anything paid in that hasn’t previously been declared is queried and it can be quite stressful for the claimant who, in most cases, hasn’t done anything wrong.

People believe mortgages aren't covered by benefits. I'm saying that they are, if you are a landlord in the private sector whose tenant is claiming housing related benefits. That is my point here - that there are benefit provisions for paying mortgages but only for the rentier class.

Right.
Thats not beneficial to the claimant

I'm on UC and PIP, unable to work at all due to disability.
I can't get credit because I don't work.
How do you suggest I finance a new boiler or car when I need one?

But someone on UC isn’t being given money to help them save they are given money to support themselves. It does sound like it could help some get on the property ladder and in theory is a good scheme. Where’s the incentive to do more for yourself though, if you’re working plus UC and can afford to save who is going to aim to earn more themselves without government help when they get it given. There’s people out there that work and earn to much for UC but not enough to be able to save, the whole system is unfair

The work around is to pay any savings into a pension

I was also thinking save up £6k have a patio door put in. Then save up again for wall coming down. Then whatever else you need.

There will be a scheme to help you with your boiler to get it free or very heavily subsidised if you ever needed that.

Because:

a) it leaves no contingency funds for unavoidable expenses, meaning that the state ends up having to provide crisis funding.

b) a starting point of zero for someone working and claiming UC top ups would mean that every time a claimant got paid they would be over the savings threshold and UC would stop. It’s unworkable. Maybe try coming at this from the pov that if you have worked and become unemployed, you have more than likely paid into the system that is paying your benefits, so are perfectly entitled to claim. Benefit claimants can be tax payers too.

PIP doesn’t qualify you for any of that, you have to be in receipt of means tested benefits, and even then there are terms and conditions that have to be met. Not everyone qualifies.

Yeah this is it - it is helpful for society/the economy/everybody if people have some sort of contingency for if the shit hits the fan. So while the ghouls, gammon and frothers amongst us would relish seeing people being utterly destitute before the government gave them a penny, it it doesn't actually make sense to do it that way, and the fact that some working people may not have £6k saved doesn't alter that. £6k seems about right to me - it's not like you could live on it for long but it's enough to deal with most of life's emergencies.

True but for some people on UC they are actually doing their best and working full time. What is better for everyone long term? Helping someone to be able to save and get on the property ladder, have housing security, which in turn helps kids to have stability. If you've got a family for example with a disabled kid, one parent working and one a carer. They've likely got a fair bit coming in from UC due to disability premiums etc. the child needs stability, needs to be near a specialist school for example or needs home adaptions that could not be done in a privately rented property. It's in everyone's interest to let that family save for a deposit to buy if they can afford to. It gets them off being reliant on help with rent for the rest of their lives. They are already penalized by only being able to have one parent working.

Someone on PIP and UC might qualify so it would be worth a look if it ever did happen

There wasn't. I had to borrow from my daughter.

People think nobody gets their mortgage paid by benefits. I'm pointing out plenty do. In this case the landlord is the indirect claimant and having their asset paid for them while they do very little is incredibly beneficial to them.
I really don't get why this is such a contentious concept.

money in your current account is counted as “savings btw”

so rent money, money for bills all considered savings

Funeral, debts, boiler, stuff for disabled people?

and when you are private renting especially in London you need huge upfront deposit and moving costs

you are forgetting uc many work and others sick and disabled

also my friend went private. And was able to get quickly treated and back to work. If she didn’t she would have been stuck waiting 3 years waiting list sick.

They used to.
I would have in 2000, cant believe i missed that gravy train

What a stupid comment

So when there’s a funeral who going to pay for that?

when they have to move and need private rents need huge deposit who going to pay for that? Especially in London?

and more examples