Budgeting Advice
A Message from Ruth Burley - HomeZone Living's Money Advisor
As a Money Advisor for HomeZone I know how challenging it can be managing a tight budget. With the credit crunch and rising fuel and food costs it is becoming increasingly difficult for all of us to manage our finances.
It can be very stressful if you feel that your debts are spiralling out of control. It is important that you stay in control so these are my tips to help you.-
Work out a weekly or monthly budget
Budget for irregular bills such as road tax and expenses such as Christmas
Use direct debits
Encourage your children to manage their money
Start a savings plan if you have money available
Seek help if you have problems with debts
This is a guide to help you consider your weekly or monthly budget and to identify if you need any further assistance or maybe you have money you could put aside for a rainy day.
Prepare a personal budgetThe first step to taking control of your finances is to complete a financial statement. It may sound obvious but it is worth just going through your weekly or monthly expenditure.
First write down the income which you will definitely receive so do not include overtime or irregular maintenance payments.
If you are working out a weekly budget remember to multiply monthly payments by 12 and divide by 52.
Then go through your all your expenditure. Be realistic, put down what you actually spend each week not what you would like it to be. Below is a basic guide to what you should include but for a more detailed income and expenditure sheet contact me on 01543 420 951 or go to www.moneysavingexpert.com where you can download a budget planner.
You might want to use the income and expenditure planner here.
Prioritise your bills according what you could lose if you do not pay them.
Priority
Rent, mortgage and secured loans - as non payment could result in the loss of your home.
Council tax - non payment could lead to bailiffs getting involved and therefore loss of possession. If you deliberately refuse to pay it can lead to prison ultimately.
Electricity and gas - non payment can lead to being cut off.
TV licence - Non payment can lead to a Magistrates court fine.
Magistrates court fines - if you do not come to an agreement with the magistrate's courts or you default on an agreement you can end up with bailiffs repossessing your possessions or, ultimately, prison.
Child Support Agency - like council tax, non payment can lead to court action and bailiffs.
Hire purchase - a Hire purchase agreement is different to a loan as the item purchased can be repossessed if payments are not made.
Non priority
Credit cards
Catalogues
Overdrafts
Personal loans
Benefit overpayments
Non payment could lead to a County Court Judgement. The court decides what you can reasonably afford once you have met your priorities. Therefore it is worth offering a repayment based on what you can afford prior to it getting to court.
If you have any money left over once you met your priority expenditure this should be divided between your non priority creditors.
If you have more money going out than coming in you may need help.
The following agencies can offer free debt advice help you to prioritise your expenditure and negotiate with creditors.
You can make an appointment with me, Ruth Burley, Money Advisor at HomeZone. I offer impartial and confidential advice on debts and benefit matters and I can help you to budget and negotiate with creditors. Contact 01543 420800 for an appointment.
Lichfield Citizens Advice Bureau
29 Levetts Fields
LICHFIELD
Staffordshire
WS13 6HY
Telephone: 01543 252730
Fax: 01543 414255
Web site: www.lichfield-cab.org (external link)
Burntwood & District Citizens Advice Bureau
Wade House
7 Cannock Road
BURNTWOOD
Staffordshire
WS7 1JS
Telephone: 0844 856 3400
Fax: 01543 684656
Web site: www.burntwoodcab.org.uk (external link)
National Debtline
tel 0808 808 4000
www.nationaldebtline.co.uk - online advice
Consumer Credit Counselling Services
tel 0800 975 9558
www.cccs.co.uk
www.turn2us.org.uk
- Turn2us helps people access the money available to them – through welfare benefits, grants and other financial help.
www.direct.gov.uk
-advice on benefits and tax
www.fsa.gov.uk
- can put you in touch with independent financial advisors, and can help people to understand the jargon associated with products to help them make an informed decision.
www.moneysavingexpert.com
- advice on how to challenge bank charges and other money saving tips.
Growing your Income
Look at all the possibilities available to you to maximise your income:
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Are you getting all the benefits you are entitled to? Contact Citizens Advice Bureau or make an appointment with me to check you are getting the correct benefits
Child Tax credit and working tax credit - If you have dependant children it is worth checking to see if you are entitled to these benefits. If you are over 25 and work 30 hours you may be entitled to working tax credit if you are on a low income. Tel 0845 300 3900
Housing Benefit and Council tax benefit to obtain a form contact Lichfield District council on 01543 308900
Council tax exemptions - If you are the only adult in the property you should be entitled to a discount of 25% off your council tax. For further advice on council tax exemptions contact Lichfield District Council on 01543 308000.
Increase your earnings, but be aware this could affect your entitlement to benefits and tax credits.
CSA Maintenance - relationship breakdown is a common cause of debt so it is worth trying to pursue maintenance. Contact the Child support agency helpline on 0845 713 3133
If you have money available once you have paid your priority expenditure and your non priority debts you may want to consider saving money so that you have money available for holidays or Christmas. You will also be able to gain interest on your savings.
Saving for a Rainy DayThere are many ways in which you can save and it is worth shopping around as interest rates vary.
If a product is described as an investment this may involve some risk of losing your original money. If you do not want to take any risk you may want to put your money into one of these types of savings accounts
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Credit Union - Credit Unions are mutual financial organisations owned and run by their members for their members.
Fusion Credit Union is a community based savings and loan organisation for people living in the Lichfield District area You can copntact them on 07972656182 for more details. Their website is www.fusioncreditunion.co.uk They run credit unions in Lichfield and Burntwood. Child Trust Fund - every child born after 1st September 2002 has £250 given to invest into any savings account. Only the child can access the money when they are 18, but you can add to it up to a set limit each year. ISAs - Individual savings accounts, you do not have to pay tax on the interest.