Join the Help to Save scheme and you could get up to £1,200 of bonus tax-free money from the government to use as an emergency fund or on whatever you want.
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Many, many, many moons ago, and even more PMs ago, we were told about the Help to Save scheme.
This savings scheme was being set up to (can you guess) help you save! But millions are still missing out on free money.
What is Help to Save?
To support in planning for the future, the government’s savings scheme allows people on low income to build up their savings.
You’re able to save up to £50 a month over 4 years and could get up to £1,200 in tax-free bonuses. If you want to save less, you can, and you can start saving at just £1 a month.
After two years, savers will get a 50% bonus based on the highest balance they’ve been able to achieve. If you’ve saved the full £50, that’s £1,200 saved plus £600 free boost from the government.
However, you can still continue saving for another two years and receive an additional 50% bonus on your savings.
Over the course of four years, if you’ve been able to save the maximum £2,400 you will get a bonus saving of £1,200.
Since its launch in September 2018, Help to Save customers have received more than £220 million in bonus payments from the government.
Who can apply for Help to Save?
The Help to Save scheme is not available to everyone, unfortunately.
It’s open to UK residents who receive Universal Credit and have take home pay of at least £1 in an assessment period.
If you live overseas and meet the criteria, you can apply if you are 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 estimated that 3.5 million people could be eligible to open an account.
When does Help to Save roll out?
The scheme started its trial in January 2018 and was rolled out in stages.
It is available to all those eligible from October 2018 onwards.
However, the scheme was due to end in September 2023, but was first extended to April 2025, and has now been extended until April 2027.
Starting to save
Natasha, a member of the Skint Dad Community Group, has access to Help to Save.
She told us: “I logged onto my personal tax account, and the government are doing saving accounts. It’s new and part of a trial, but I think it’s pretty impressive as it will help me save more.
“It’s really simple to do, and it’s a good idea to get people into the routine of saving, whether it would be a £1 or £50.”
Natasha has already started her saving and has a goal in mind: “I’m hoping I could put it towards a new car at the end of four years.”
Since sharing, she joined Help to Save, other members of the community have also joined and started saving too.
Is Help to Save fair?
While I think it’s great to give an opportunity to help low earners save money, I know there will be people miffed that they can’t take part.
Personally, I would have loved to get over £1,000 in bonus payments, but I can see why the government cannot afford to roll it out to everyone.
Those who get paid more might easily afford the £50 a month and would go all in…but they probably don’t need to bonus payment as much as others.
The ones who miss out are people who work, earn just over the amount to get benefits, yet struggle to get by month to month.
Wouldn’t it be nice to have a tax incentive thrown to people in the middle every now and then?!
Is it unfair?
Not everyone is a big fan of the new scheme.
Gary, also a member of the Skint Dad Community Group, explained why he’s not a fan.
“The closest thing to this for people not claiming these eligible benefits is the Flexclusive Regular Saver via Nationwide which offers 5% interest. This new scheme is offering 50%. That’s insane.”
Having been a saver for many years, Gary feels the government is singling our those on benefits:
“I’m very happy to contribute to the system to help support those in need. But I don’t feel those in receipt of benefits should be ‘helped’ even further by a scheme of this sort.
“I feel that if there is this ‘bonus’ money available to pay to those families who are signing up to this scheme then surely that money would be better used elsewhere.”
Emergency fund
Stats show that four in ten of us have less than £500 set aside as an emergency fund.
So if something were to happen (the washing machine packs in, the boiler goes or your car just won’t start) then you’ve got no way to pay for it. This generally means people turn to credit and get into more debt.
It’s best, if possible, to have three to six months of rent/mortgage and bills saved in an easy to access account to cover things for an emergency.
When you add this up it’s a huge chunk of money, but it can take some financial stress away knowing that you’ve got a buffer.
The Help to Save scheme has been set up as a way to help you save for an emergency but, in truth, you can use it for whatever you want.
How do you check your Help to Save account?
You need to set up a Help to Save Account on the government site, and give your National Insurance number/postcode and other ID.
What if you’re skint?
Maybe you start paying in £50 a month as you can afford it (or you thought you could). But then your circumstances change, or maybe the cooker just won’t heat up anymore, and you need a new one!
You don’t need to fret.
The money you’ve saved in Help to Save can be withdrawn at any time, and you can lower your saving level.
However, if you take it out, it could affect the size of the bonus payment you get.
Not entitled to Help to Save?
While it may seem like a big sting that you can’t take advantage of the offer, there are other options.
If you don’t need to access your savings, you can get a massive return on an auto-enrolment pension with your employer. For every penny you put in, your employer and the government add contributions to top up the amount, making it worth a whole lot more!
However, if you want to build up an emergency pot, you will not be able to access this money for years.
If you find saving money hard, try some of these ideas:
Missing out on anything else?
If you’re married, you could make a tax saving with the Marriage Allowance, depending on how much you earn.
Naomi knows the burden of living on very little and became debt free by following her own money saving tips and tricks. She is an expert on saving money at the supermarket and side hustles.
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