Thousands of people on Universal Credit and other qualifying benefits now have the chance to grow their savings with extra support from the government. The Help to Save scheme, run by HMRC and backed by the Department for Work and Pensions (DWP), has been extended until April 2025. This extension means eligible individuals can still open an account and access bonuses worth up to £1,200, simply for saving regularly.
What Is the Help to Save Scheme?
The scheme was designed to help people on lower incomes build financial stability. Account holders can save between £1 and £50 each month, and the government rewards their savings with a 50% bonus. This bonus is paid directly into the saver’s account at two separate stages over the four-year scheme.
For example, someone saving £50 a month would contribute £1,200 over two years. The government would add £600 as a bonus. If the saver continues for another two years at the same rate, another £600 bonus is added. In total, that person could receive £1,200 in free government money, resulting in savings of up to £3,600 by the end of the scheme.
How the Bonuses Work Over Four Years
The Help to Save account provides bonuses in two instalments:
- First Bonus: Paid at the end of the first two years. This is equal to 50% of the highest balance achieved in that time.
- Second Bonus: Paid at the end of the fourth year. This is 50% of the increase in savings during years three and four compared to the balance after the first two years.
It’s important to note that withdrawing money during the account term can reduce the size of the bonus. For this reason, savers are encouraged to leave their funds untouched if possible.
Key Features of the Account
The Help to Save account comes with several flexible features:
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- Save between £1 and £50 per month.
- Skip saving in certain months without penalty.
- Withdraw money at any time (though this may reduce the bonus).
- Accounts remain open for four years only and close automatically at the end.
If the account is closed early, any unpaid bonuses will be lost, and you cannot open another Help to Save account later.
Eligibility Criteria – Who Can Apply?
To open a Help to Save account, applicants must meet the following conditions:
- Be receiving Universal Credit, with take-home pay of at least £1 in the most recent monthly assessment period.
- OR be entitled to Working Tax Credit (alone or alongside Child Tax Credit).
- Be a UK resident.
People living abroad may still qualify if they are:
- Crown servants (or married to/civil partners with one).
- Members of the British armed forces (or their spouse/civil partner).
Couples receiving benefits together can both apply, but each must open a separate account.
Why the Extension Matters
Originally scheduled to end in September 2023, the scheme has now been extended until April 2025. Since its launch in 2018, more than 359,000 people have opened accounts. However, government figures suggest that up to 3 million more people are eligible but have not yet signed up.
The extension provides a vital opportunity for more low-income households to:
- Build financial resilience.
- Improve money management habits.
- Access government-funded bonuses for simply saving.
Why Help to Save Is Important in 2025
In the current climate of rising bills and living costs, saving has become harder for many families. The Help to Save scheme offers a rare chance to not only set aside money but also to receive a substantial financial boost from the government. For many households, this could provide much-needed security and act as a safety net in times of financial strain.
FAQs
Q1: What is the Help to Save scheme?
The Help to Save scheme is a government-backed savings plan that allows people on lower incomes to save between £1 and £50 a month and earn a 50% bonus, up to £1,200 over four years.
Q2: Who is eligible to open a Help to Save account?
You must be receiving Universal Credit (with at least £1 earned in the last assessment) or be entitled to Working Tax Credit. UK residency is required, but Crown servants and armed forces members abroad may also qualify.
Q3: How much can I earn from the scheme?
If you save £50 a month for four years, you can save £2,400 and receive £1,200 in bonuses – giving you a total of up to £3,600.
Q4: Can I withdraw my savings during the scheme?
Yes, withdrawals are allowed at any time, but they may reduce the bonus you receive.
Q5: When does the scheme end?
The scheme has been extended and will now run until April 2025. After this date, no new accounts can be opened.
