Millions of people who earn just over £1 a month could receive a cash boost of up to £1,200, as the UK government has announced plans to expand the Help to Save scheme. Originally set to end in April next year, the scheme will now run until April 2027, with eligibility being widened to include all working Universal Credit claimants.
Under the Help to Save scheme, individuals can save between £1 and £50 per month and receive a 50% government bonus after the second and fourth years. This means that those saving the maximum of £2,400 over four years could receive a £1,200 bonus directly into their bank account.
Currently, Universal Credit claimants must have a take-home pay of at least £793.17 in their last assessment period to qualify for a Help to Save account. However, starting April 2025, the scheme will be open to all working Universal Credit claimants earning at least £1 a month.
The initiative, introduced in 2018 and extended until April 2025, has seen nearly 450,000 individuals open accounts, according to HMRC data. Those receiving working tax credits and child tax credits may also be eligible for an account, which can be checked and opened on gov.uk or through the HMRC app.
The announcement of the expansion of the Help to Save scheme was made by chancellor Rachel Reeves in the autumn Budget statement. The government aims to provide a financial incentive for low-wage workers to save money regularly and build financial resilience.
This move comes as part of the government’s efforts to support individuals in managing their finances and planning for the future. By encouraging saving habits through the Help to Save scheme, more people can access additional funds to help with unexpected expenses or long-term goals.
The extension of the scheme and the broadening of eligibility criteria are expected to benefit a larger number of individuals who may have previously been excluded from such initiatives. As the cost of living continues to rise, schemes like Help to Save can provide much-needed financial support to those on lower incomes.
Overall, the expansion of the Help to Save scheme represents a positive step towards promoting financial inclusion and assisting individuals in building a stronger financial foundation for themselves and their families. By incentivising regular saving, the scheme aims to empower more people to take control of their finances and improve their financial well-being in the long run.