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?

If you’re not suggesting that owned homes are sold to release capital before you can claim benefits, what are you suggesting, because from what you’ve posted here, that seems to be exactly what you’re saying.

I have no clue what you’re talking about. I haven’t targeted you in any way, I’ve simply replied to your posts - l certainly haven’t accused you of anything. The discussion was around housing benefits, and the simple premise was that there are no direct DWP schemes to contribute to claimants’ mortgage payments in the same way as housing benefits help with rent. You then turned the whole discussion on its head by pointing out that housing benefits contribute to the mortgages of landlords. That may well be the case, but it’s not the primary intention of housing benefit, and does’t benefit the claimant in any way. HB is paid to the tenant in order to pay their rent. What the landlord does with it after that is irrelevant. The only scheme open to actual benefit claimants to help with mortgage payments is SMI, a loan which is repayable with interest, and which only covers interest on mortgages up to £200,000. Can we stop derailing now ?

Again, if you'd like to point to where I've said different, please do let me know.

Actually don't bother. Because (a) you can't. And (b) you've taken an entirely innocuous and commonsense point and made it into this massive thing where you absolutely have to prove me wrong and insist I've said things I certainly haven't. You've even gone so far as to accuse me of justifying "feckless women" while wanting disabled people to suffer which is both inaccurate and ludicrous.

So have your final word if you want and get it over and done with. I have no idea why you've got such a problem with me but frankly your negativity is spoiling my day.

That is how I read it too. Some people seem to believe you should only be able to claim benefits if you only have the clothes on your back to your name.
They would probably think that an un-used credit card should be counted as savings too. Or an overdraft.

Which were based on figures from 30yrs ago. Not increased for inflation.

I’m saying by all means claim means tested benefits when your worth is tied up in bricks and mortar, but on the proviso that you repay tax payer % or amount even a proportion at a later date via a charge when the property is sold… it’s no longer bricks/mortar, it’s cash in bank and so should be treated no different to a renters savings or way capital is for care home fees. Someone with hundreds and thousands in property equity is much better off and not destitute vs a renter with just £5k to their name.

UC only starts to be reduced at that amount. The whole point of the creation of the system was to help those who really needed it to survive, so having a good amount of savings is personal money which can be used to live on.

In which case you use the savings and then apply for UC?

Disagree that is right or fair. Home owners on means tested benefits are deemed some of the most vulnerable according to politicians yet a renter who works and is heavily taxed maybe paying for that hammock in some cases. If someone owns a house worth £500k+ outright why should a renter tax payer be classed as having broader shoulders if they have in contrast little capital? It’s a nonsense and unjustified.

The person saying where do you draw the line misses the point, if you sell most other assets they are classed as savings. Housing equity given state of country needs to be same especially as income is earned, equity is not necessarily so increases inequality.

What if it is never sold? What if it is passed on to children after the death of the claimant? What if it is needed to fund care?

Thankfully, the DWP are only concerned with the £ you have in all accounts, and the value of property you do not live in.

The only time people have to pay back benefits is if they were overpaid, or they were claiming fraudulently.

Care home fees are different as the person has left the property and gone into care... and wont be going back.

£6k wont last most households that long, especially if they have kids. It would be delaying claiming UC by a few months at most. If it is due to losing a job, hopefully they wont be claiming for long anyway.
Someone going on UC because they have been assessed as not fit for work will go through their savings, then never be able to get them back.

Someone who is heavily taxed wont be on UC.

Again, a house only becomes capital if it is sold. The DWP don't care about the value of the house you live in. It is not even part of applying for UC.

You can get mad about that all you want, but getting mad at homeowners on UC is bizarre when they are not doing anything wrong.

So you're suggesting that benefits paid to people who own their homes should take the form of a loan secured on their property? Could get a bit rob Peter to pay Paul if they ever need to go into a care home. And what about people who go on to earn money after a stint on benefits? Are they to repay their benefits too?

Its an odd position to take. Because for a start off, the number of benefits claimants sitting on hundreds of thousands in equity will be quite small, hardly worth the admin costs entailed. And those who are will undoubtedly be claiming benefits as a result of a life interrupted. Because you don't get to own hundreds of thousands in equity unless you've worked and paid a mortgage, and had to stop due to health, disability or care commitments. Seems an odd group for even the most ardent anti 'scrounger' to target.

I'm not excusing it. I'm pointing out it's the law so is applied to UC. If you want to change it, lobby your MP. Posting on MN won't do it.

I had a read of this fine piece of investigative journalism

1.1m up on UC who don't have to look for work. This includes, people with no work allowance ie disabled. Pensioners. Those in full time education. And parents with children under 1.

Approx 440,000 were moved over from ESA

240,000 new pensioners

And 740,000 on a type of new pension credit started in 2025

Thats pretty much gets me to 1.2m

I didnt really spend long looking for information. Probably more than the author of this fine bit of media.

BTW @Chocaholick what's your disability? Show me yours and i'll show you mine?

Oh shit, I can't have one. I'm typing on the Internet

This!
And people forget that UC covers a lot of legacy benefits, several of which were out of work ones. So people going on about only 38% of people on UC work, are not really making any sort of valid point. In fact, I am not really sure what point they are making.

Of course and that's why I said savings of £6000 is only taken from UC at a minimum amount.

Imagine the email... "I don't own my house, so I don't think benefit claimants should own a home too".

You’re trying to defend the indefensible. Why is it right or fair a homeowner’s capital is kept indefinitely but a renters meagre savings are fair game? Equality of treatment important as know a few owned outright homeowners using means tested benefit rules at present like a hammock. Taxpayers shouldn’t have to pay for someone else’s inheritance full stop. As someone else said benefits (means tested) are there for a safety net but that should be up to a point.

My home is owned outright. When it was paid off, it was worth £140k or so. Now, for nothing to do with me at all... just the way of the market and how things go up in value, it is worth about £230k Disclaimer - these figures may or may not be accurate
I am on UC. Do you think I should be forced to sell the home I live in (which is a very modest property... it is not a fucking mansion)?
I live in it right now. Therefore it is not classed as an asset.

Again, the DWP do not give a fuck about the value of the house you live in. They only care if you own other houses. So stop making up your own rules.

No silly
Give your house to the DWP so they can then give you more money to rent it from them

You are making the argument against wealth taxes which some people on here have argued should be used to fund benefits. Bit ironic really. That’s not a dig btw as I actually agree with you!

I have seen posts on here about wealth taxes. I agree with them, when applied to the ultra wealthy.

Nobody answered this before. If you give over your house, should you also give over your car? Your engagement ring? Your nice winter coat? What about if you have a pedigree pet? Bye bye doggie?