Saving money can be a challenge for many, and household outgoings can often seeming as though they’re never-ending. While setting aside money for the future may be the last thing on one’s mind with everyday living costs to cover, some may look to save what they can. Under the Help to Save scheme, some people, including certain Universal Credit claimants, could see their savings get a boost.
Help to Save is a type of savings account, and it allows 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 the course of four years.
This particular scheme is backed by the government, meaning the savings in the scheme are secure.
Those who are eligible can save between £1 and £50 each calendar month in this account, but they do not have to pay money in every month.
This can be done by debit card, standing order, or bank transfer.
Should a person withdraw money from their Help to Save account, gov.uk explains that they can only do this to their bank account.Universal Credit claimants may be able to open a Help to Save account (Image: GETTY)
At the end of the second and fourth years, the saver can get the bonuses, which are based on how much as been saved.
Then, four years after it was opened, the Help to Save account will close.
While a person will be able to keep the money from their account, they will not be able to reopen it or open another Help to Save account.
After the first two years, the first bonus from saving in the account will be paid - how much will it be?
The bonus will be 50 percent of the highest balance a person has saved.
This means that the saver will get any bonuses they’ve earned even if they withdraw money.
Fast forward to after four years, and the saver will get a final bonus if they have continued to save.
This amount will be 50 percent of the difference between the two amounts.Universal Credit: The maximum bonus is £1,200 (Image: GETTY)
That’s the difference between:
- 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 in this time, then the saver will not earn a final bonus, gov.uk explains.
The website also explains that as there is the £50 limit per calendar month, £2,400 can be saved into the Help to Save over the course of four years.
This means that the most a person can earn from savings in four years is £1,200 in bonus money.
Savers shouldn’t expect to see the money paid into their Help to Save account, as it is instead paid into their bank account.
Who is eligible for a Help to Save account?
A person can open this type of account if they’re any of the following:
- Receiving Working Tax Credit
- Entitled to Working Tax Credit and receiving Child Tax Credit
- Claiming Universal Credit and their household earned £569.22 or more from paid work in their last monthly assessment period.
Additionally, a person needs to be living in the UK.
That said, if a person is a member of the British armed forces or their spouse or civil partner, or a Crown servant or their spouse or civil partner, living overseas, then they too can apply for an account.
Gov.uk points out that saving money though a Help to Save account could affect your eligibility for certain benefits and how much you get, and the website details this.