The UK Department for Work and Pensions (DWP) is helping Universal Credit and Working Tax Credit claimants strengthen their financial foundation through the Help to Save scheme.
This government initiative allows eligible low-income earners to earn up to £1,200 in bonuses over four years simply by saving a little each month.
Here’s a step-by-step guide to eligibility, how the scheme works, and how you can make the most of this valuable opportunity.
What Is the Help to Save Scheme?
Help to Save is a government-backed savings program designed to encourage low-income individuals to develop a savings habit.
Through this scheme, eligible claimants can save up to £50 a month and earn a 50% bonus on their highest savings balance after two and four years.
This means that regular savers can earn up to £1,200 in bonus payments over the four-year period, providing an accessible way to build long-term financial security.
Key Features of the Help to Save Scheme
- Maximum Monthly Savings: Save up to £50 each month, totaling £2,400 over four years.
- Bonus Structure: Earn a 50% bonus on the highest balance achieved, resulting in up to £1,200 in bonuses.
- Payment Schedule: Bonuses are paid at the end of the second and fourth years.
- Flexibility: There’s no penalty for saving less than £50 per month, allowing flexibility based on your financial circumstances.
Eligibility for the £1,200 Bonus
Eligibility for the Help to Save scheme depends on your current benefit status and income level. Here’s what you need to know about qualifying for this program:
Current Eligibility Requirements
To be eligible, you must:
- Receive Universal Credit: You should have a monthly take-home income of at least £722.45 from your last assessment period, ensuring the scheme supports those in the low-income bracket.
- Receive Working Tax Credit: Alternatively, those entitled to Working Tax Credit or Child Tax Credit can also qualify for Help to Save.
Upcoming Eligibility Expansion
In April 2025, eligibility will expand to all working Universal Credit claimants, removing the income requirement. This change will open the scheme to even more low-income individuals.
How Does the Help to Save Scheme Work?
The Help to Save scheme is easy to use and encourages saving through flexible contributions and a simple bonus system. Here’s how you can start:
Step 1: Open an Account
Visit the Help to Save website and apply for an account. You’ll need to create a Government Gateway ID and password if you don’t already have one, and have your UK bank details on hand for bonus payments.
Step 2: Start Saving
You can save anywhere from £1 to £50 each month, depending on what you can afford. While you aren’t required to save the maximum every month, aiming for consistent savings can help you earn the maximum bonus. Missing a month doesn’t penalize you, but remember that your bonuses are based on your highest balance.
Step 3: Receive Your Bonus
Bonuses are paid out at the end of two-year intervals:
- After Two Years: You’ll receive a 50% bonus based on the highest balance in your account over the first two years.
- After Four Years: You’ll receive another 50% bonus on the highest balance from years three and four.
Example of Potential Earnings
If you save the maximum amount of £50 per month, here’s how your savings and bonuses could add up:
- Total Savings: £2,400 over four years.
- Bonus After Two Years: £600.
- Bonus After Four Years: Another £600.
- Total Value: £3,600 (including your original savings and bonuses).
Tips for Maximizing Your Savings
Maximizing your Help to Save bonus can be simple with a few strategies:
- Set a Monthly Savings Goal: Aim to save consistently, even if you can’t reach the £50 limit every month.
- Automate Your Savings: Set up a standing order to deposit funds automatically each month, ensuring you don’t miss any contributions.
- Monitor Your Progress: Log into the Help to Save portal regularly to track your balance and keep an eye on your bonus growth.
Why Participate in Help to Save?
The Help to Save scheme is more than just a savings account. It encourages financial discipline and provides a safety net for low-income households.
Here are some reasons why participating in Help to Save could be beneficial:
- Enhanced Financial Security: Building a savings habit can provide a cushion for unexpected expenses.
- Flexible Contributions: Save what you can each month without penalties, making it adaptable to changing financial circumstances.
- Access to Savings Anytime: Withdrawals are allowed, though they may impact the bonus amount based on your highest balance.
Additional Financial Support for Universal Credit Claimants
Help to Save isn’t the only resource available to low-income households. Here are a few other financial support programs for Universal Credit claimants:
- Healthy Start Scheme: Provides vouchers for essential food items like milk, fruit, and vegetables, supporting pregnant women and families with young children.
- Sure Start Maternity Grant: A one-time payment of £500 for new parents to help with the costs associated with a new baby.
- Discretionary Housing Payment: Offers financial assistance with housing costs that may not be fully covered by Universal Credit or Housing Benefit.
- Energy Grants: Several energy providers offer grants to help with high energy bills. You can check eligibility requirements on the Ofgem website or with your provider.
The Help to Save scheme is an excellent opportunity to create a financial buffer while benefiting from government incentives.
By saving as little as £1 a month, you can work toward financial stability and make the most of the £1,200 bonus, especially as more Universal Credit claimants become eligible in 2025.
