Univeral Credit & Child Savings Accounts

atlantis187

Thanks for that plum
U are right we have been extremely carefully with money even though I am on a low salary. We have not had a holiday in last 7 years or spend on anything extravagent.
We just wanted to save as much as possible to be mortgage free and save a little for our 2 boys future

Pricivius

Which is all very nice and admirable, but you don't get to do that on the taxpayer. You can save up to £16,000 which it seems you have done. That's the extent of the nest egg you are allowed to create. We would all love to pay off our mortgage and save for our kids' future, but we can't use benefits to do it.

lazer

atlantis187 wrote: »

Thanks for that plum
U are right we have been extremely carefully with money even though I am on a low salary. We have not had a holiday in last 7 years or spend on anything extravagent.
We just wanted to save as much as possible to be mortgage free and save a little for our 2 boys future

Can you not overpay your mortgage instead of saving?

SkyeKnight

LunaLady wrote: »

Why should you receive benefits if you have enough money that you are able to save £26k?

Benefits are meant as a safety net, not something to line your nest with.

Benefits are also paid to make working worthwhile, so they are currently more than the bare minimum. A full-time minimum-wage job would pay around £12k/year - considerably less than out-of-work benefits would pay for a family with a couple of kids.

So, you have to give the minimum-wage earner some benefits too - and then a bit more to make sure working is worthwhile. Now the family on £15k has less money, so you have to give them benefits, and a bit more to make sure they have more than the £12k family otherwise it's not worth earning more, and the family on £20k, and £25k, etc, etc.

I've read that many years ago even the lowliest job would pay enough to support a family - thus work always paid and top-up benefits were not required. The benefits system has had to become outrageously complicated since that changed.

FBaby

SkyeKnight wrote: »

Benefits are also paid to make working worthwhile, so they are currently more than the bare minimum. A full-time minimum-wage job would pay around £12k/year - considerably less than out-of-work benefits would pay for a family with a couple of kids.

But if they are able to save such a large amount, then clearly they are managing without it?

I have to say that I am puzzled as to how someone who relies on tax credits (so on a low income) can manage to save such a large amount, unless part (or whole) or it came from a lump sum somewhere.

SkyeKnight

FBaby wrote: »

But if they are able to save such a large amount, then clearly they are managing without it?

I have to say that I am puzzled as to how someone who relies on tax credits (so on a low income) can manage to save such a large amount, unless part (or whole) or it came from a lump sum somewhere.

Yes, that's the point I was making - Tax Credits are paid at way more than a subsistence level (we get them, but earn quite a bit and have savings too). We could just about manage without Tax Credits and Child Benefit, but would then have a lower net income than someone on minimum wage who does claim them. I claim them because I think my family should have a higher net income than one earning tens of thousands of pounds less income.

Poppie68

I agree with some of the for and against points on this thread,i thought tax credits are paid for people with low income to help with day to day living, in this case they don't seem to have been needed as that is quite a sizeable savings balance, and you would also like to 'hide' the savings to maximize on benefits in the future.

Pedent

skintandscared wrote: »

I don't think I've ever read anything quite so ridiculous. Benefits are there for those people who can't feed/clothe/house themselves without it.

This just isn't true.

If it were true, then someone who currently receives tax credits and can feed, clothe and house themselves who sees their income go up would see their tax credits award go down by the same amount.

What actually happens is that their tax credits award goes down by at most 41% of the increase, leaving them with extra income that they don't need to feed, clothe, and house themselves.

You may think that it should be true, but that's not the same thing.

SkyeKnight

Pedent wrote: »

This just isn't true.

If it were true, then someone who currently receives tax credits and can feed, clothe and house themselves who sees their income go up would see their tax credits award go down by the same amount.

What actually happens is that their tax credits award goes down by at most 41% of the increase, leaving them with extra income that they don't need to feed, clothe, and house themselves.

You may think that it should be true, but that's not the same thing.

Exactly what I was trying to say - but much better written!

princessdon

Until they reach a point where they stop of course. I have always failed to see why tax credits and savings were not linked.