WARNING! Before claiming, clear savings/debts!

jago25_98 · 22 March 2005 at 12:27PM

Do not answer thier questions until ready!

- need to claim job seekers allowance to get help finding a job at the job centre

- they asked me informally whether I had savings. I said `yes`, but they are exceeded by my student debt; I cose not to pay off my debt because the money earns more in a high interest account.

- although I wasn't filling out forms the savings were noted and this means I would get £14 a week.

Don't do what I did!

Next time get rid of your savings by paying off debts BEFORE even stepping in the job centre! You can't get rid of them after as this is deemed `making yourself broke` even though it's to pay off debts!! This way the government is forcing you to borrow money from them.

The government with student loans is exactly the same as othe loan companies - they don't want you to pay it off, they want you to forever be their slave.

Link to FAQ item (thanks Fran!):
http://forums.moneysavingexpert.com/showthread.html?p=260157#post260157

And deprivation of capital (in a thread reply from Ted_Hutchinson) :
http://groups-beta.google.com/group/uk.gov.social-security/msg/d9bd7d5d2517a35e?amp;output=gplain

camper · 22 March 2005 at 10:43PM

Actually, if you do use up all your savings within say three months before claiming benefits, to pay off debts where there is no legal obligation to, you can be deemed to still have that money.

So jago is not correct in his/her assumptions.

camper · 22 March 2005 at 10:46PM

the job centres are there to help everyone
you do not need to claim any benefits to use any or all of the facilities

jago25_98 · 22 March 2005 at 11:11PM

"Actually, if you do use up all your savings within say three months before claiming benefits, to pay off debts where there is no legal obligation to, you can be deemed to still have that money."

^ I mean to agree with this.

"you do not need to claim any benefits to use any or all of the facilities"

^ I'm afraid this has changed recently; try it, you'll be referred to the phone or internet.

Curry_Queen · 23 March 2005 at 9:19AM

If you dispose of capital/savings in order to qualify for means-tested benefits you will not be allowed to claim, regardless of whether that money was used to pay off debts/mortgage etc.

The DWP can and will insist on seeing all bank statements, savings books etc too.

Fran · 23 March 2005 at 12:41PM

There is info about this on the thread Capital, income & savings - on benefits which is found by going to FAQ's - a sticky at the top of this board.

Fran · 23 March 2005 at 4:19PM

Zziggi wrote:

was just a hypothetical question. I was unaware that the IR and DWP were so closely related (Now?). I suppose what all this says is that you should either spend every penny you've got, or if you have got some, hide it in the mattress!

If you read the threads in the link in my post above, it sheds more light on how much etc.

Curry_Queen · 23 March 2005 at 5:09PM

Zziggi wrote:

was just a hypothetical question. I was unaware that the IR and DWP were so closely related (Now?). I suppose what all this says is that you should either spend every penny you've got, or if you have got some, hide it in the mattress!

Well this is the problem I'm faced with if I continue to save at the rate I had planned (discussed in another thread) which is a PITA as it means I will either have to spend money frivolously to avoid going over the threshold or, as you say, hide it under the mattress :rolleyes:

But then would I be seen as "disposing of capital to remain on benefits" if I spent my savings, which I received from them in the first place!!! You can't win

Fran · 24 March 2005 at 12:45AM

Zziggi wrote:

Means tested benefits is not a lot to live on but if you are very very careful you can save a tiny bit.

Sorry Zziggi but I disagree with this. I would defy anyone to save who is on means tested benefits alone. If you get a non means tested benefit such as DLA you might then be able to save if the expenses for your disability were not as much as you receive. It has got to be wrong though that because you might also receive Income Support that you can't save any other money such as DLA, which might be for something essential that you need to save up for or just that you need to have some extra put aside in case something breaks down - eg. as you mentioned boiler or washing machine if you need to do extra loads of washing because of your disability. It just seems crazy that you have to spend a benefit like DLA as you go along or forfeit Income Support because you have "saved up".

Curry_Queen · 24 March 2005 at 1:12AM

Sorry Fran but I have to disagree with you. I spent over 2 years on IS, before I was awarded DLA, and I also managed to save money out of that. I started off by paying back a Social Fund loan at £12 a week and once that ended I realised I could manage ok without it and that's when I started my savings.

filigree_2 · 24 March 2005 at 3:32AM

I can understand that there has to be a point where your assets prevent you from claiming IS, or theoretically non-working lottery winners could claim it! I do think that the system discourages poorer families from saving.

Imagine a low income family who diligently save for a rainy day. The breadwinner loses their job, and their rainy day savings mean they get reduced or no IS. If they'd spent their spare cash on fags and booze, they'd get IS much earlier.

It's not good moneysaving practice but sometimes I think I'd be better keeping my savings in a sock under the mattress. I can't conceal my current savings but if no-one knows about future savings I can't be penalised for them.

WARNING! Before claiming, clear savings/debts!

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