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Original poster

Universal Credit Savings Limit

78 replies

DavidB6721 · 28/09/2021 16:23

Nobody with more than £16,000 in capital is allowed to claim any means tested benefits in the UK. Do you think this limit seems a bit low? The reason for that is because it has not been increased for 33 years!

If you think that is not fair, you might be interested in one of the petitions on the UK parliament website at the moment, which is calling for a substantial increase in the benefits capital limit (petition number 590695).

If the moderators will allow me to include a link, you can find it at:

petition.parliament.uk/petitions/590695

If you agree, you might wish to consider consider signing this petition and sharing it on social media, etc.

OP posts:
Tealightsandd · 28/09/2021 17:16

@MrsKeats

So on these abysmal wages you can save up 16k? Can't be that abysmal then can they? Come on now.
Inheritance, for example. A good sum - probably enough for a house deposit, but the family/individual won't get a mortgage due to their low income and/or the source of income being benefits (the inherent disability discrimination in that is another issue that should be tackled).

You prefer to pay huge sums of money to house homeless families and vulnerable disabled people in expensive temporary accommodation?

People inherit, have to spend it all on rent - and then they have to turn back to the state again. Ridiculous, cruel, and a huge cost to the taxpayer.

Mynextname · 28/09/2021 17:18

I agree because although I will probably never have anything like that amount of money I think it is a poverty trap.

In an ideal would benefits would be a safety net. However, wages are not designed to be able to support families on their own with the high costs of modern living and so benefits have become necessary for families to maintain a reasonable standard of living.

It's not fair that someone could sit on a house worth millions and claim universal credit whilst two working adults are not allowed to save up for a house deposit without losing their universal credit that has essentially been put in place to prop up the economy so wages can stay low. This system reduces social mobility.

I think those that don't own the capital in a house should have a far higher limit.

Gingerkittykat · 28/09/2021 17:20

@MrsKeats

You must be joking. There are loads and loads of jobs going where I am. Get a bloody job.
The majority of people on UC do already have jobs and it tops up their wages and pays a proportion of childcare.

Another huge chunk of people on UC are either disabled or carers.

It's not as simple as just go out and get a job.

nc4565 · 28/09/2021 17:21

The £16k thing is nonsense.

If you're claiming UC, it's a safety net for when you have nothing. £0 savings, £0 income, £0 investment and 0 prospect of any money in the immediate term.

I should know, I've been on UC before when we had absolutely nothing. I was genuinely shocked when they said we could have applied earlier when we still had thousands in the bank Shock!

MeAndDebbieMcGee · 28/09/2021 17:25

It's very shortsighted really.

£16k isn't enough for a mortgage deposit. Most people on UC are working so if they never buy a house it just means ever increasing amounts of UC ie public money going to their landlord.

Also means that if they ever do lose their jobs they'll have less money to finance retraining/house moves/all the shit we're all supposed to do in those situations which again means less financial independence from the state ie more state money paid out.

MrsKeats · 28/09/2021 17:26

Yes and they are doing ok if they have 16k in the bank. It's not fair to raise this when national insurance is going up for people.

CornishTiger · 28/09/2021 17:29

@nc4565

The £16k thing is nonsense.

If you're claiming UC, it's a safety net for when you have nothing. £0 savings, £0 income, £0 investment and 0 prospect of any money in the immediate term.

I should know, I've been on UC before when we had absolutely nothing. I was genuinely shocked when they said we could have applied earlier when we still had thousands in the bank Shock!

@nc4565 then that’s your poor research.

UC is not a safety net for when you have nothing. That’s why there are capital limits, work allowances etc. Set by government.

MeAndDebbieMcGee · 28/09/2021 17:31

Most people on UC also pay ni because they're working.

inmyslippers · 28/09/2021 17:31

Yes and they are doing ok if they have 16k in the bank. It's not fair to raise this when national insurance is going up for people.

^that low threshold will keep people
In receipt of universal credit and costing tax payers more though. 16k isn't enough in savings for a pension or house

CornishTiger · 28/09/2021 17:32

The amount of capital reviews I’ve done when people’s circumstances have changed suddenly and they have come into benefits just make me look at this so differently.

People who have done the right thing by saving for house deposits, those with mortgages saving for home improvements. Then a life changing event changes things and those savings get eroded and they end up relying on benefits long term.

CornishTiger · 28/09/2021 17:33

Yep I pay my tax, NI and student loan. Plus pension contributions.

Bet that blows people’s minds who think those on UC don’t work.

Bluebellbike · 28/09/2021 17:33

I If you are saving in a help to buy ISA for a property deposit those savings are disregarded as they can only be used for a deposit on a home.

Tealightsandd · 28/09/2021 17:34

@MrsKeats

Yes and they are doing ok if they have 16k in the bank. It's not fair to raise this when national insurance is going up for people.
If they're private renters, that money will go. Fast. And then what? The safety net is falling apart. Who pays their rent? Funds their pension?

The low threshold is a false economy.

Obviously the UK needs a lot more social housing, but in the meantime it would make economic - taxpayer money saving - sense to allow a higher threshold, at least for ringfenced house deposit savings (and ideally pension too).

Stressed21 · 28/09/2021 17:34

I think those that don't own the capital in a house should have a far higher limit.

Totally agree. I work full time and earn 27k and get UC, because my rent is extortionate. Why should I be prevented from saving for a deposit which would essentially take me off UC?

So short sighted (and a couple of really ignorant posters on this thread)

Tealightsandd · 28/09/2021 17:35

@Bluebellbike

I If you are saving in a help to buy ISA for a property deposit those savings are disregarded as they can only be used for a deposit on a home.
I thought they were only disregarded for tax purposes? If also disregarded for benefits purposes, that's a very good step in the right direction.
AwaAnBileYerHeid · 28/09/2021 17:36

The limit should be lower! I have a cousin who gets UC (including disability elements/PIP or whatever it's called). He live with my aunt who owns the house outright so he doesn't really spend much. My aunt and cousin are constantly having to spend spend spend his money by giving it away to his siblings, holidays etc as there was a period where he had, a few times, had parts of his benefits stopped as he kept exceeding the 16k limit.

Benefits are to help people out, there is no way people should be amassing thousands in savings from them.

MeAndDebbieMcGee · 28/09/2021 17:37

The scheme's closed now as of a couple of years ago anyway.

Tealightsandd · 28/09/2021 17:37

Although the LISAs are age discriminated as they're only allowed for people under 40. The fastest growing group of private renters is the over 40s.

MrsKeats · 28/09/2021 17:37

There are other rules around pensions.

TreeFella · 28/09/2021 17:38

I've signed. As said, a house deposit is way more than 16000 and as a single full time worker I would stop being eligible for top ups and be unable to save more. My job would be considered well paid I think but as there's only me earning in the house, it's a low limit before I'd stop being eligible. Definitely needs increasing if the limit was set in times when 16000 was a huge amount of money. And I don't have anywhere near that amount of savings.

Tealightsandd · 28/09/2021 17:39

Yes the Help to Buy ISAs closed. A shame because they were better (and more age inclusive) than the replacement LISAs.

MLMbotsno · 28/09/2021 17:40

@gogohm

Because benefits are a safety net, if you have £16k you don't need help.
This. Benefits are a safety net not for people with savings.
CornishTiger · 28/09/2021 17:42

Sums saved in the Help to Buy and Lifetime Are taken into account for capital limits.

This would leave someone with Lifetime Isa savings facing the prospect of a 25 per cent penalty to withdraw that money to use it for living expenses, as unless you're aged over 60 it can only be used for the purpose of buying a first home.

MeAndDebbieMcGee · 28/09/2021 17:42

Maybe 25 years ago. Benefits are now an integral part of wage planning and of the workplace economy. Get with the program daddy-o.

CornishTiger · 28/09/2021 17:43

Except that’s not what the rules state.