Why no more than £16000 in savings?

Newly_retired

Greenface says "BTW i went into the C.A.B for some advice on carers allowance and as i owned my house(had over 100k equity in it) they couldnt give me free information."
I work for CAB and we give free information/ advice to anyone. CAB is an impartial, confidential, non-discriminatory charity.
However some specialist CAB advisors may be limited by the source of the funding eg some of our money advice workers can only work with people in receipt of benefits, so their appointments are restricted to certain clients. Our employment case worker can only give appointments to people on benefits, but can give phone advice to anyone we refer to him. Our benefits case worker can advise anyone on their entitlement. It all depends on the funding when it comes to specialist advice.
yes the £16K is a threshold for certain means-tested benefits. Seems reasonable to me, especially as ther is a sliding scale below that, so it is not an all or nothing issue.
Hope this helps.

savetilibleed

reck_uk wrote: »

I’ve seen this mentioned a few times on this forum, you should never have more than £16000 in your savings account. What’s the reasoning for this?

Is it something to do with the benefits you would receive if you became unemployed? If so surely the benefit is tied to how much you have in savings, so it wouldn’t just be <£16000 you get full benefit >£16000 you get none. If its tied to how much you have in savings surely there wouldn’t be hardly any difference between say someone who had £15000 and someone who £16000 in savings.

THIS LINK might help explain it and how savings between £6000 and £16000 affects some benefits, age depending.

Mickygg

reck_uk wrote: »

I don't understand this point of view. My brother earns a similar salary to me but the way he spends his money is completely different. He does not save anything, as soon as he has some money he has to spend it, flat screen tv's, game consoles, cars, nice holidays etc. I'm a saver, I go without a lot of nice things in life but over the years I've saved some money in case of emergency, for instance if I need medical help etc.

Now lets assume we both lost our jobs at the same time and were unemployed for a long time. He would have no savings at all and would get benefits straight away to help him pay his bills. As i've saved all my life and gone without i'm expected to use all that money i;ve put aside to pay my bills, while the tax payer would pay my brothers.

So he'll be sat at home in front of his nice flat panel tv, playing on his games console while his bills get paid, while each month i'll be seeing my hard earned savings slowly disappear.

Why should someone who is sensible with their money and doesn't squander it away be punished and have their life savings slowly taken away and get no help from the government even though we both pay the same amount of tax.

Maybe it's wise not to save to much money and instead spend it, maybe an extension to the house or a decent car. At least this way no one can take it away like they can if you leave it in the bank.

Am I alone in this viewpoint?

Totally agree with you. My sis has been out of work for a year watching her savings rapidly go. Her neighbour has everything paid for in benefits as spent all their money on house and holidays. Its certainly taught my sister not to save a pot of money again.

Diesel44

ses6jwg wrote: »

Why should you get benefits when you have the equivlant of some people's annual salaries sat in your bank, to be fair?

I agree with this statement.
How do you save £16000 is my question.
I have been in work now for 31 years and only have £6000 in savings, yes married, yes two children, yes two cars.
Holidays are on a budget, jobs around the house are on a budget.
No flat screen tv, still using a video recorder, no sky.
My wife works and we have a mortgage.
My money seems to go on BILLS BILLS BILLS.

lisyloo

Am I alone in this viewpoint?

Hi reck_uk,

You are certainly not alone.
It's a commonly felt injustice.
But it's not an easy one to solve.
Would you put the brother on the street?
Would you make him sell his TV's and games consoles which would fetch a pittance second hand?

I do think we need welfare reform.
I would like to see people who are unemployed (and medically fit) doing some type of work for their benefits.
This would give them prospects, discipline etc.
But I am certainly aware that it is not an easy problem to solve.

lisyloo

How do you save £16000 is my question.

Well one way is to have a smaller mortgage and not have two cars.
We picked a house near a train station and only have one car even if we need to go seperate ways.
I save about £1500 per year by not having a car.
That wasn't a particualrly expensive car but when you add in tax, mot, repairs, servicing, depreciation, petrol, breakdown etc. it all adds up.

There are really only two variables I'm afraid.
One is income and one is outgoings.
Either you need to increase your income of reduce your outgoings.
Sorry if that sounds trite but that's what it comes down to.
It's not clear whether your "problem" is income or outgoings.

Or perhaps you just cannot expect to have loads of savings whilst your kids are growing up.
To be honest most of those with money, save it after their kids have left home, so I don't think your situation is unusual.

reck_uk

Diesel44, £16000 is a lot of money but the argument still stands if you have less savings like us (my savings are nearer to yours than 16k). If you have thousands of pounds in savings that 6k is going to have to go before you will be entitled to the same benefit as someone who didn’t bother saving anything.

It took me many years to build up my savings, along with some sacrifices, so you can see why I would be upset to see all my savings slowly being taken away from me while someone else who didn’t bother to save had money given to them.

So what is the best advice for savers? On the one hand we are advised to save around 6 months’ worth of salary but then run the risk of that being taken away from us. Alternatively we could spend (or invest if you like) our savings in improving our life’s now such as making house improvements, buying a nice car etc. This way we get to enjoy the money we worked hard earning and yet still be entitled to benefit if the time comes when we need it.

Lisyloo it is a difficult situation, I agree with you we need welfare and we can’t ignore the people that need benefit at a time in their lives when they need it most. I suppose we can’t have it both ways. But given the situation as it stands now what’s the best thing to do for people that have managed to save some money over the years?

Mini_Bear

perhaps it comes down to whether you like the security of having a cash pot to dip into for unexpected costs or treats. Or would you be fine with living hand to mouth paycheck to paycheck forever. The stress of having to wait for housing benefit/income support to initially kick off would be a horrible time i imagine.
Would it not make people think to save a little in future?
Also i know people are described as living like kings off the state when they are on benefits but thats really not the case from my experience of (made redundant) ex-colleagues. You can afford to survive, but its only those that have played the system from a young age that have any real luxuries.
Im not sure i could survive on £50/week job seekers (im 24!!!)