Stoozing while on Universal Credit can cost you money

ninianne42

This is a warning to those not in the know. I have been on UC for 6 years. 3 years ago, I got a 0% interest card with a £5000 limit, so decided to Stooze. I spent up to the limit, saved the unspent money, and at the end of 2 years had earned nearly £500 in interest. Result! Or so I thought... 

What I didn't take into account was that on UC if your savings rise above £6000, they count every £250 or part thereof as a monthly income of £4.35. My stoozing took my savings to £10,000. My assumption was that as I had £5000 debt on my credit card, my net savings were under £6000. WRONG. UC does not deduct debt from savings. In their eyes I had £10,000, £4,000 over the threshold which for a year equals 16 x £4.35/ month x 12 = £835.20 in earnings. UC deducts 55p off your benefit for every £1.00 earned, so they have over paid me £459.36. That wipes out my interests earned from stoozing. And that's just for one year, I stoozed for two years. So I'm worse off. 

MattMattMattUK

ninianne42 said:

This is a warning to those not in the know. I have been on UC for 6 years. 3 years ago, I got a 0% interest card with a £5000 limit, so decided to Stooze. I spent up to the limit, saved the unspent money, and at the end of 2 years had earned nearly £500 in interest. Result! Or so I thought... 

What I didn't take into account was that on UC if your savings rise above £6000, they count every £250 or part thereof as a monthly income of £4.35. My stoozing took my savings to £10,000. My assumption was that as I had £5000 debt on my credit card, my net savings were under £6000. WRONG. UC does not deduct debt from savings. In their eyes I had £10,000, £4,000 over the threshold which for a year equals 16 x £4.35/ month x 12 = £835.20 in earnings. UC deducts 55p off your benefit for every £1.00 earned, so they have over paid me £459.36. That wipes out my interests earned from stoozing. And that's just for one year, I stoozed for two years. So I'm worse off. 

Did you also declare the interest you received to UC as well as that is income.

ninianne42

Yes, they have all the statements

eskbanker

ninianne42 said:

My assumption was that as I had £5000 debt on my credit card, my net savings were under £6000. WRONG. UC does not deduct debt from savings.

As clearly stated online:

All money, savings and investments you have in the UK and abroad are taken into account, including:

• cash
• money in your bank account, including your main bank account
• current accounts and digital-only accounts such as PayPal
• savings accounts: bank, building society, credit union, Help to Save, Post Office and National Savings and Investments (NS&I) accounts
• [...]

We do not take your debt into account when we work out your total money, savings and investments.

https://www.gov.uk/guidance/universal-credit-money-savings-and-investments#what-we-take-into-account

ninianne42

Yes, eskbanker, I know this now. It's unfortunate it isn't in block capitals on the website!  

ninianne42

If only I had found the time in the midst of my serious illness and redundancy to read every page on the UC website - no defence in a court of law, I know, but it is the lived reality of many on benefits. Ho-hum.