Starting to invest while on Universal Credit?

NomadicBrit

Hi, I'm looking to start investing shortly. I seek to build multiple income streams so I can move abroad and be financially free.

I aim to open a separate investment account which I can use exclusively for investing a bit of money each month into bonds, shares and more through platforms like Trading 212. I'm thinking long-term here.

While I'm currently not in work, I am seeking employment so the chances of me becoming disabled and unable to work (hence having to sell) are quite low. So I will not be on UC forever, although I don't know how long I will still be onUCt because the job market is terrible.

How do I go about this with Universal Credit? When do I report it? And are they likely to take an issue with me doing this? I know you have to report stocks and savings when you first claim, but not during it. I have under 6k in savings.

Apologies if this is the wrong subforum for this, i'm not sure if this belongs more in UC or investing.

Has anyone else been in a similar position? Would love to hear experiences.

Thanks everyone

Brie

It's my understanding that you need to update them when your savings go over £6k.  

Basically if you are making money, no matter how, you may not be entitled to UC.  

Baldytyke88

If you invest the shares/funds in a SIPP(self invested personal pension) then that will not affect UC and could help you reduce your savings/earnings.

Grumpy_chap

NomadicBrit said:

Hi, I'm looking to start investing shortly. I seek to build multiple income streams so I can move abroad and be financially free.

I aim to open a separate investment account which I can use exclusively for investing a bit of money each month into bonds, shares and more through platforms like Trading 212. I'm thinking long-term here.

While I'm currently not in work, I am seeking employment so the chances of me becoming disabled and unable to work (hence having to sell) are quite low. So I will not be on UC forever, although I don't know how long I will still be onUCt because the job market is terrible.

How do I go about this with Universal Credit? When do I report it? And are they likely to take an issue with me doing this? I know you have to report stocks and savings when you first claim, but not during it. I have under 6k in savings.

Apologies if this is the wrong subforum for this, i'm not sure if this belongs more in UC or investing.

Has anyone else been in a similar position? Would love to hear experiences.

Thanks everyone

I think this might be better in the "benefits & tax credits" area of the forum.

AIUI, it is necessary to report total "capital" at the start of a UC claim.  "Capital" is quite broad and includes:

• cash, savings, bank accounts, premium bonds, ISA
• stocks, shares, bonds
• property you own but don't live in
• assets within a business that you own - the rules here are rather more complex as there are some disregards and also a "look through the veil"

If the total of all "capital" is less than £6k, that is all that the benefits claim will assess and no impact to UC entitlement.
If the total of "capital" is greater than £16k,that is all the benefits claim will assess and no UC entitlement.
Between those two thresholds, the value of UC entitlement is revised for every £250 of capital held.  This should be reported every assessment period / every time there is a change of £250 or more (in either direction).  In the case of shareholdings. the value of "capital" may change by £250 or more simply through market movement.

AIUI, every movement of "capital" of £250 or more should be reported, but the criticality of reporting depends on where your total is in relation to the thresholds.  If you have £2k capital and end with £4k capital, it makes no difference to the UC award so quite different to mis-reporting if you had £5.5k and ended with £6.5k capital.

You should also look to understand the rules with regard to income within the assessment period and when that becomes capital.

peteuk

Once you claim UC (if successful) then as noted above you need to declare capital above £6K, at which point your UC will be reduced by £4.35 per £250 or part of above £6K. 

£6001 - £6250 - reduced by £4.35
£6251 - £6500 - reduced by £8.70 etc etc 

They will also ask for your account details as part of the application. 

TELLIT01

You need to inform DWP (if claiming UC) of all bank accounts and other capital be that shares or anything else.  You can do what you like with the UC payments but I would have assumed the amount of spare cash to be pretty low.  That being the case, and dividend from shares is likely to be minimal anyway.

Brie

Baldytyke88 said:

If you invest the shares/funds in a SIPP(self invested personal pension) then that will not affect UC and could help you reduce your savings/earnings.

While this might solve the problem of investing it does leave the issue of accessing the money when the OP wants to move overseas as there are likely to be restrictions based on age.  

NomadicBrit

TELLIT01 said:

You need to inform DWP (if claiming UC) of all bank accounts and other capital be that shares or anything else.  You can do what you like with the UC payments but I would have assumed the amount of spare cash to be pretty low.  That being the case, and dividend from shares is likely to be minimal anyway.

I also claim PIP so i'm quite fortunaste to have the money to start.

so from what i understand, i can start investing now but i have to report it to UC (including new accounts). as i currently have under 6k it won't affect my entitlement. thanks everyone