What should we do?

Busyizzy_2

Hi all, my first post on here! I'm trying to work out what the best thing to do for my family is. Basically we have 2 kids aged 1 and 4. My partner does 2 jobs, the main one paying about 14 k a year, the other one about 6 k a year. I used to work 30 hours a week but after my recentmaternity leave I have only gone back to work 15 hours a week, earning about 6 k a year. We pay £38 a week childcare and rent privately. We have just been told our child tax credit will be dropping to about £40 a month from April, we were getting much more than that so this came as a bit of a shock! Neither my partner or I have ever claimed benefits, other than child benefit and child tax credit, but I now feel we're working away for nothing, my partners second job involves him working most evenings and every other weekend, and we have no money or quality of life for it. This figure of £16,170 a year keeps coming up, basically implying if you earn more than that you get next to no help. So what should we do?
1) Keep going as we are?
2)increase my hours (and hence childcare costs, I earn about £50 a day,
childcare is £38 + 40 mile commute)
3)I don't work at all, partner continues doing 2 jobs
4)I don't work at all, partner quits his second job therefore only bringing in 14k a year

I don't want to have to resort to claiming benefits but i also feel i have to put the needs of my family first, and will do whatever it takes to make us all happy, be it work us more or less hours.
So, what would you do?

McKneff

Betwen you you are earning £26k and then get child benefit, and tax credits.
Surely you shouldnt be struggling on that amount of money per annum.

To drop down to 1 income to enable you to claim from the state would be disastrous, you really
wold be living on the breadline

If you are struggling , post up an SOA and we will try to help you with a budget to help with your finance.

Jowo_2

Does your household have debts?

You can model your proposed scenarios on the Turn2us online benefit calculator. It will identify if you are entitled to any local housing allowance.

Download the MSE budget planner and work through the site to identify where you can make changes, live more frugally and up your income. The site has lots of info on cheaper tariffs, cheap recipes, cutting consumption.

Your husband nets about £1300 per month. You net approx £500 per month. Child benefit is another nearly £150 per month. So there is nearly £2000 per month, plus what you indicate are fairly good tax credits, on top. Your child care costs are low.

Your household nets nearly £500 per week excluding tax credits. Where's your money going?

zagfles

Your tax credits don't sound right, you should get more than £40 a month next year on an income under 30k with 2 kids. Is that based on your 09/10 income?

Also if you could work 1 extra hour a week you could get childcare help in tax credits (both need to be working 16+ hours).

Busyizzy_2

Thank you for your replies. Maybe we should be looking into where are money is going. It largely seems to be on rent, bills etc but your right, we should be doing a proper budget. Can I ask what soa is? We have no debts, so that's not a problem. I think £40 a month for 2 kids sounds to low as well, the figures were based on last years income when I was working 30 hours a week. I have informed them of all the changes but they gave me the impression it would make no difference, I was guessing because of this £16,170 cut off figure i keep reading about. I guess I was thinking if our joint income was only 14 k we would be entitled to help with rent, council tax, more tax credits, free school dinners etc which would equal to roughly the same amount as we get now with both of us working. Am I totally wrong in thinking this?

Jowo_2

Busyizzy wrote: »

.. I guess I was thinking if our joint income was only 14 k we would be entitled to help with rent, council tax, more tax credits, free school dinners etc which would equal to roughly the same amount as we get now with both of us working. Am I totally wrong in thinking this?

This is something you have to model as a scenario on the Turn2us benefit calculator. The LHA direct website will indicate your current maximum LHA rate and the Turn2us calculator would then factor in your other income and adjust this downwards.

But if you get less disposable income without understanding where your budget is vanishing, then you may find that despite the additional benefits (such as cheaper rent and CT), your overall smaller disposable income continues to dissipate at the same or higher rate. But I suppose you'd have more spare time...

Am I correct that free school meals isn't payable to those who receiving working tax credits? Don't know if this is a national or council by council basis.

Do also model an optimistic scenario - you could actually be better off if you earn more and work longer hours!

Will be interesting to hear the result of your Turn2us calculations for different scenarios.

Of course, you would get around £200 per week in tax credits, child benefit and income support if you kick your husband out and give up work, plus LHA and CT....

lauzellen

SOA = Statement of affairs... use this link to create one http://www.makesenseofcards.com/soacalc.html You can then post it on here - or the debt free wannabe forum if you want help in identify ways to reduce your outgoings

merlin68

You don't get free school dinners on working tax credit and you wouldn't get your council tax paid either.

Busyizzy_2

I've just been on that turn2u website and have done sone rough calculations. It claims that on our current income we should be getting 71.06 per week child tax credit, so hopefully the £40 a month they quoted us is wrong. They also said we should be getting £3.61 a week housing benefit.
I then did it on an income of 6 k for me and 14 k for my partner, eg no second job for him. It said we should get £98.84 per week child tax credit, £26.05 a week housing benefit and £17.09 a week working tax credit. I'm not sure why/how we would get working tax credit though as I didn't think I was eligible if only working 15 hours a week?
I then did it as only my partner working one job at 14k, me not working at all. For this it claims we should be getting £61.98 a week working tax credit (still confused how that could be), £98.84 per week child tax credit, £8.48 a week council tax benefit and £71.31 a week housing benefit. If this is correct, which I'm not convinced it is, it reckons we should get a total of 14,849.77 a year in benefits / tax credits. This is obviously more than the 12,000 we make by my partner working a second job, and me working at all, therefore suggesting we're better off with just my partner working one job earning 14 k a year.
I'm actually hoping this is wrong. Would the citizens advice bureau be able to work things out exactly for us do you think?

McKneff

But you are capable of working, both of you and paying your own way, what you are doing is morally wrong, you are trying to find ways of milking the system, it seems to be the way of the world at the moment. Sorry if thats blunt but Im a pensioner, still working, have done since I was 15, and it annoys the life out of me the way this government doles out cash to people who are more than capable of working and chose, yes, chose not to and then give them my money.

Apart from anything else, its hardly a role model for your children, they need to grow up with a good work ethic which they would only learn from you both.

dktreesea

Busyizzy wrote: »

I've just been on that turn2u website and have done sone rough calculations. It claims that on our current income we should be getting 71.06 per week child tax credit, so hopefully the £40 a month they quoted us is wrong. They also said we should be getting £3.61 a week housing benefit.
I then did it on an income of 6 k for me and 14 k for my partner, eg no second job for him. It said we should get £98.84 per week child tax credit, £26.05 a week housing benefit and £17.09 a week working tax credit. I'm not sure why/how we would get working tax credit though as I didn't think I was eligible if only working 15 hours a week?
I then did it as only my partner working one job at 14k, me not working at all. For this it claims we should be getting £61.98 a week working tax credit (still confused how that could be), £98.84 per week child tax credit, £8.48 a week council tax benefit and £71.31 a week housing benefit. If this is correct, which I'm not convinced it is, it reckons we should get a total of 14,849.77 a year in benefits / tax credits. This is obviously more than the 12,000 we make by my partner working a second job, and me working at all, therefore suggesting we're better off with just my partner working one job earning 14 k a year.
I'm actually hoping this is wrong. Would the citizens advice bureau be able to work things out exactly for us do you think?

You are probably right. Unfortunately with our benefits system, the way benefits get clawed back, particularly if you rent from a private landlord, can mean you end up out of pocket (i.e. with less money overall) if you increase the amount of money you earn from working. My OP is in a similar situation to yours, i.e. he has a second stream of income, which reduces the benefits we would get, if he didn't have the second lot of work, by more than what he actually nets from that work.

It's a tricky juggling act. If it affects your quality of life too much if your OP does a second job, maybe it would be more sensible, health as well as income wise, to quit the second job and take the resulting increase in benefits instead?

And before you let the moral indignation crowd get you down if you decide to go down that route, please remember this: the only reason your family qualify for any benefits at all is because the government has set the minimum wage way too low for a family to be able to live on it. If the minimum wage was a living wage, anyone who was working full time would be earning enough to support their family fully and not be entitled to benefits at all (as it should be imho, :-).

To all those who want to niggle at people accepting benefits, why don't you redirect your anger to someone who might actually be able to do something about getting the minimum wage set to enough to live in, i.e. your MP?