If you know where to look, you can grab thousands from employers and the government...
When all is said and done, there’s only one person that you should rely on for financial security -- and that’s you.
Don’t turn down free money
While you can expect some support from the government and your employer (if you’re working), this will be pretty limited. Indeed, with the government spending £3 billion a week more than it earns, state benefits will increasingly be aimed only at the most vulnerable in society.
That said, never turn down ‘free’ money if it’s on offer and you’re entitled to claim it. After all, with so many spending cuts on the horizon, this cash may not be available for much longer.
So, here are ten ways to get more money from the government and in the workplace – before they start to disappear:
From the state
1. Child Benefit
Unusually, Child Benefit is a ‘universal’ benefit, which means that it’s not means-tested. In other words, you can claim it regardless of your personal circumstances -- all you need is at least one child.
For your eldest child, Child Benefit is £20.30 a week, but this drops to £13.40 a week per additional child. Usually, Child Benefit is paid every four weeks (13 times a year). As an added bonus, Child Benefit is tax free, so it’s worth £1,055.60 a year for the first child and £696.80 a year per additional child.
The Government recently froze Child Benefit, but there are still rumours it may be cut for children over the age of 16 who are in full-time education.
2. Child Tax Credit
If you have at least one child living with you, and you’re on a low income, then you may be entitled to Child Tax Credit. This is means-tested, so how much you get depends on factors such as your wage, the number of hours you work (if you work), how many children live with you, and your childcare costs. It’s estimated that nine out of 10 families with children qualify for some form of tax credits.
3. Working Tax Credit
Like Child Tax Credit, Working Tax Credit is mean-tested, but Working Tax Credit is also available to childless workers. If you’re employed or self-employed and on a low income, then WTC ‘tops up’ your wage. There is a basic element of Working Tax Credit, plus extra payments for single parents, couples, disabled workers, and those with children.
4. Statutory Sick Pay
If you’re unable to work because of illness or injury for at least four days in a row, and you earn at least £97 a week, then you can claim Statutory Sick Pay. This benefit is paid by your employer for up to 28 weeks. The standard weekly rate for Statutory Sick Pay is £79.15, which usually is paid via your payroll.
5. Statutory Maternity Pay
To claim Statutory Maternity Pay, a woman must have been working for at least 26 weeks into the 15th week before the week her baby is due. During this period, her average wage must be at least £97 a week.
For the first six weeks, Statutory Maternity Pay is paid at 90% of her average gross weekly earnings with no upper limit. For the remaining 33 weeks, it is the lower of £124.88 or 90% of her average gross weekly earnings.
Get expert help
Of course, the state-benefits system is fiendishly complicated, a bit like navigating a maze blindfolded. For an expert guide through this maze, visit free, independent advice website Turn2Us or the DWP’s online Benefits Adviser.
From an employer
1. Pension
Of all the benefits on offer from an employer, I consider a company pension to be one of the most valuable. Indeed, if you’re not already a member of your occupational pension scheme, then join it now. Otherwise, you could be missing out on extra ‘deferred pay’ worth, say, 5% to 25% of your income.
2. Car or travel allowance
Use of a company car (or a cash alternative) is another valuable benefit, especially with fuel almost £1.20 a litre at some garages.
However, as with most ‘benefits in kind’, the taxman hits company-car drivers with a tax bill, the size of which depends on the vehicle’s value and emissions. So, drivers of luxury gas-guzzlers pay most, whereas the tax bill for a low-carbon run-around would be much lower.
3. Childcare vouchers
Now that both of our children are at primary school, my wife no longer claims tax-free childcare vouchers from her employer. However, she used to sacrifice the maximum £55 a week of her salary in return for the same sum in childcare vouchers. This saved her around £100 a month in reduced income tax and National Insurance contributions. However, the saving can be as high as £1,778 a year for very high earners.
4. Savings schemes
If you work for a company which offers free or discounted shares to employees, then grab these with both hands. (Alas, this excludes public-sector workers and the self-employed.)
In today's video, I'm going to highlight five things you should consider when choosing a savings account.
For example, thousands of companies allow workers to buy shares at a 20% discount by saving for three, five or seven years in a Save As You Earn (SAYE or Sharesave scheme). Using SAYE, I know people who have turned £250 a month for five years -- a total of £15,000 -- into £45,000+. Likewise, buying discounted or free shares via Share Incentive Plans (SIPs) is often a no-brainer.
5. Free protection
Around six million people in the UK have private medical insurance (PMI) to pay for private healthcare and treatment. The most popular provider is BUPA, but PMI is complicated and expensive to buy individually. Hence, it’s much easier to join your employer’s PMI scheme.
With NHS dentists thin on the ground these days, the same goes for employer-provided dental insurance. If your employer pays these insurance premiums for you, then even better --although you will pay tax on this benefit.
Give yourself a boost
In summary, if you’re struggling to get by on what you’re earning at the moment, then take a long, hard look at what’s on offer at work and from the state. You may be pleasantly surprised at the financial boost doing your research can provide!
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