Universal Credit claimants could boost bank balance by up to £1,200 – how to apply
This Morning: Martin Lewis discusses Help to Save scheme
For many, saving money for the future has been something that’s simply not been possible this year. The coronavirus pandemic rages on, and sadly, financial uncertainty still remains.
Whether setting aside money is an option right now or not, there is a way in which those on low income may be able to get help with savings.
Help to Save is a type of savings account, and it is backed by the government.
This means all savings in the scheme are secure.
This account enables certain people who are entitled to Working Tax Credit or receiving Universal Credit to get a bonus of 50 pence for every £1 they save over four years.
There are restrictions when it comes to how much can be paid into the account.
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Savers can set aside between £1 and £50 each calendar month in the account.
That said, money doesn’t need to be paid in every month.
The money can be paid into the Help to Save account by debit card, standing order or bank transfer.
It can be paid in as many times as one likes, provided they don’t exceed the £50 per calendar month limit.
At the end of the second and fourth years, bonuses will be paid.
These bonuses are based on how much a person has saved.
Rather than being paid into the Help to Save account, bonuses are paid into a person’s bank account.
How much is the Help to Save bonus?
After the first two years, those who have used their account to save will get their first bonus.
This will be 50 percent of the highest balance saved.
After four years, the final bonus will be paid, provided they’ve continued to save.
This bonus will be 50 percent of the difference between two amounts:
- The highest balance saved in the first two years (years one and two)
- The highest balance saved in the last two years (years three and four).
Should the highest balance not increase, a final bonus can’t be earned.
With the most that can be paid into the account each calendar month being £50, a total of £2,400 can be saved over four years.
As such, the most that can be earned from the savings in four years is £1,200 in bonus money.
It’s important to check to see whether and how saving via Help to Save can affect eligibility for certain benefits.
Who is eligible for Help to Save?
A person can open a Help to Save account if any of the following apply:
- They’re receiving Working Tax Credit
- They’re entitled to Working Tax Credit and receiving Child Tax Credit
They’re claiming Universal Credit and they (with their partner if it’s a joint claim) earned £604.56 or more from paid work in their last monthly assessment period.
Additionally, the person needs to be living in the UK.
Those who live overseas can apply for an account if they’re either a Crown servant or their spouse or civil partner, or a member of the British armed forces or their spouse or civil partner.
It’s possible to apply for the Help to Save account online, via the government website.
To do this, applicants will need to provide their UK bank details and have created a Government Gateway user ID and password to apply.
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