What are reasonable expenses?

Digitalscooby

From what I have read so far it seems the key to a successful DMP is to set a budget that you can reasonably live by which means you can keep up the monthly payments.

We have sat down and worked through everything we spend and we have / are making cutbacks where we can. There are some things we can't reduce just now (we are tied into mobile contracts for a while yet for example).

I have been through the figures with National Debtline and we are more or less aligned although they did ‘caution’ me we were at the higher end of their guidelines in some areas.

I have also looked at the debt remedy tool provided by CCCS but I gave up on that after I got to ‘we would recommend you spend between 0 and 7 pounds per month on prescription charges’! Either you need them or you don’t (I need 3 per month for Asthma and High Blood pressure my wife also needs some less often).

The guide figures given by National Debtline sometimes also take no account of reality. X for clothing – I work in a professional office and have to wear suits shirts and ties to work every day. My wife has similar dress requirements, my son and daughter need school uniforms never mind their usual clothes. This is the same guideline figure for people who perhaps don’t work and have kids not of school age.

There is a figure for property repair / emergency. Totally disregards the age, size or state of repair of the property.

Some people on here say be reasonable – you can’t have two weeks in the sun but you could perhaps have the odd cheap weekend away. You can’t buy lavish gifts but it’s fair enough to set aside money for birthdays, weddings and Christmas. It’s reasonable to have hobbies and the odd night out – if you don’t you’ll go mad.

Others seem to take the opposite view, from their review of other people’s SOA – you must live on the absolute bare minimum for the 4 ½ years it takes to pay off your debt. No treats, few reserves.

How do you balance the two? If I know work is very likely to have to be done on the house or car should I budget for it (one reply here suggested you should not). My wife and I have one weekend away with friends once a year. We have given up on annual holidays. Should I budget for that, if I don’t how do I explain it – we don’t want anyone to know about our debts.

My kids are older. My son is 14 but built like an adult. He eats like one and wears adult clothes. Do I make allowance for that?

We have an income of £4,300. We have essential bills (mortgage, fuel etc) of £1,600. We are offering the creditors £1,550 leaving us £1,150 to live on (petrol is a quarter of that, my wife works in the community and travels all day every day). If we really squeezed everything we could maybe cut another £50 - £100 off that but there will be times of the year we will really struggle.

My worry is we will agree to anything to get the DMP in place and then find, a little way down the line that we are really struggling. We have a lot of debt (£80k) We WANT to pay it but we don’t want to be in despair for 4 years.

Are we being reasonable?

DS

MrsTinks

First of all - a DMP isn't set in stone - if you find that your car needs repairs you can speak to CCCS etc and explain that and change your payment that month.
House repairs... unless they are paramount repairs that will otherwise cause the house to fall down or cause you to be without water or heating etc then they are not important enough right now. So things like paiting a room or updating a bathroom etc are off the menu for a while!
Clothes - it's amazing how cheaply you can manage - try Primark, charity shops and ebay. If you need new suits then Tesco and Asda often do VERY cheap ones if you can't find one in a charity shop or ebay. They're not Armani but they do the job just fine.
childrens clothes - freecycle! Save your budget to buy their uniforms and see if it's possible to buy outgrown ones from pupils a year above.

It will only be despair if you feel hard done by all the time - look at it as a fun challenge and it really won't be as bad as I think your fear...

euronorris

Hi there!

I know it can be tricky and you want to find the right balance so you can stick to it. But you also have to realise that some things need to go on the back burner for a while.

As MrsTine has said, you can get clothes and suits VERY cheap these days from various places. And you shouldn't need to buy a new suit every month. If you have been doing so in the past then your wardrobe must be absolutely full to the brim with suitable work clothes. Have a sort through what you have before considering buying anymore. The same for your wife too.

The prescriptions - if you need quite a few each month, have you considered the pre-payment certificate: http://www.dh.gov.uk/en/Healthcare/Medicinespharmacyandindustry/Prescriptions/NHSCosts/DH_4049383 It should work out cheaper for you if you don't already have it.

As for days out, entertainment etc, of course you need it! We all do for the sake of sanity. However, be reasonable about the costs. There are plenty of things you can do for free or very cheap. For me personally, 50pm is reasonable, but I couldn't justify anymore than that. I keep myself plenty entertained from that and it pays for an online game subscription too.

I assume you have posted your SOA before? If not, why not post it and we can offer guidance. You can then make the changes you feel comfortable with.

But remember, the more you can increase those repayments, the quicker you'll be debt free!

mum2one

have you thought of putting a soa (statement of affaris up) as you may find that once its in black and white as they say, you may be able to save on one area and balance on another x

misspoppy

who are you doing your DMP with becasue they should give you budget figures from what i've read they will have things you don't spend that much on each month but they leave it in to allow you things where your budget is higher. I also think they allow you a modest holiday.

Digitalscooby

misspoppy wrote: »

who are you doing your DMP with becasue they should give you budget figures from what i've read they will have things you don't spend that much on each month but they leave it in to allow you things where your budget is higher. I also think they allow you a modest holiday.

CCCS. I have been through a budget with National Debtline and they have sent me the DMP pack which they will forward to CCCS. It is that I am in the middle of completing (can't send it back just yet until my new basic bank account is opened).

The post is really more about my feelings as I am going through the form and not anything CCS have allowed or dis-allowed. I suppose the way forward is to put everything down and then talk it through with them.

DS

Digitalscooby

euronorris wrote: »

Hi there!

and it pays for an online game subscription too.

ooooh I forgot about that expense :think:

yellowduck_2

CCS sugested that I go on a DMP and I am on ESA.I decieded not to. This was because even with £0 budgeted for cothes, entertainment, housing repairs and emergencies, haircuts in fact anything other than food, fuel, my phone, insurance and water. I felt that this was just too restrictive. I think it's really hard when we have to cut back, I get really down in my current situation, so I do try to look at living on very little as a challenge. Otherwise I could get bogged down in the dullness of it all. I find that I actully eat some really nice meals as always cook from scratch and use up all the leftovers.

bigmommamuppet

Hi DS and welcome to the boards,

I'm with the CCCS and some of the things we need are over the recommended budget guidelines i.e petrol we spend a whopping £320p/m of the bl**dy stuff but we need that as we have two cars that travel 500 miles a week for work. The CCCS take notes for higher than average expenditure and will include that as part of your I/E list that they send to your creditors. Not one of ours has questioned our higher than average amounts.

Also as others have said clothes can be bought cheaply (I have discovered all sorts of budget clothing websites since I've been on my DMP). Our family 'treats' come from careful budgeting with the food shopping etc. with most weekends involving a day out (swimming, cinema for £1, beach etc) but with no money worries so we enjoy it more.

I do agree not to make your budget too tight as you'll never succeed, esp. if your in it for the long haul (I think my revised DFD is Mar 2013), we all need to have life whilst paying back our debt albeit on a tighter budget than before.

Becks

misspoppy

Generally people live better once they have gone into a DMP because they aren't robbing peter to pay paul I think things will be ok but may be for the first time you will have to live within a budget and plan ahead financialy rather than stick it on a card as you may have done in the past.
you could prepare for this lifestyle by starting a spending diary that you and your wife monitor daily or weekly so you cut out any unneccessary spending and get into the habit.

Ames

I found CCCS far too restrictive. They took into account my DLA as income, but didn't allow me care needs, they told me my amount of £20 a week was too much for entertainment, and that I should cut it to £15 - but they meant per month. There was definitely nothing there for a modest holiday! They said that I wasn't struggling, I was budgeting badly and should increase my debt repayments from what I was paying.

As someone with mental health problems, I knew that sitting in the house 24 hours a day 7 days a week, with an hour or two out for shopping or doctors appointments would leave me in a very bad state, and so I went to CAB. They looked at the same figures and said my only real option was bankruptcy.

So even amongst the 'experts' there's different approaches and opinions! Remember, that all the experts are doing is recommending, it's your debt and your life, and at the end of the day you need to do what's best for you.