Just started an IVA

boblardo

We have month 2 into our IVA but already we are finding it hard. On Paper our budget looks great but the reality is totally different.

We started our IVA on December 1st 2012. Our budget allows us to put some money aside for clothes, car tax, insurance etc each month.

EG: The car tax is due now, £118.50 and we have just £38 saved up for it.

We have had to take the extra £80 from housekeeping which means struggling for the rest of the month either by buying less food, petrol etc.

I assume it will get easier the further in we get as our "savings" pool grows

Don't know where else I can cut back either

Just a rant, sorry!

john10001

That is really tough. I am glad you posted though as it may help others (inc me) plan for an eventual IVA and build up a little before.

I am possibly going down the same route as you and I also have car tax, car insurance and MOT coming up for renewal very soon.

My car is very unreliable and costs me a lot in repairs and servicing costs each year, more than most would expect or want to pay out. It is presently broken and needs to be recovered to a garage for more work and full servicing :mad:

I may have to dip into small amount of savings I was going to put towards IVA in order to get my car sorted before hand. I would like to sell it or exchange it in for something similar in price, or not much more expensive, but much more reliable and possibly a couple of years younger and with less milage. Possibly also one that will be on lower tax bands and insurance groups and have better fuel economy.

This is something I am thinking about greatly at the moment as I need my car for work and other essential personal reasons. I can't afford to be without it. I have had to use public transport recently and also sometimes walk as well when I ran out of money which is a nightmare because public transport is more expensive and unreliable, and I live quite a distance from my work (5 miles there and back). I may have to dip into the small savings I have in order to sort that situation out ahead of an IVA, which should also help reduce my future expenditure in those areas.

I think it may also be an idea for one or two months before I start the whole IVA process to cancel all payments out to creditors in order to build up a reserve, or to reduce drastically to just a token payment (Thinking about interest and charges not increasing the debt too much). Maybe pay just enough so that the debt doesn't increase after interest and charges (paying estimated interest only).

I think a lot of other people in an IVA must have encountered this issue as well in not having built up enough reserve to pay for bigger costs like these.

UpToMyNeckInIt

john10001 wrote: »

That is really tough. I am glad you posted though as it may help others (inc me) plan for an eventual IVA and build up a little before.

I am possibly going down the same route as you and I also have car tax, car insurance and MOT coming up for renewal very soon.

My car is very unreliable and costs me a lot in repairs and servicing costs each year, more than most would expect or want to pay out. It is presently broken and needs to be recovered to a garage for more work and full servicing :mad:

I may have to dip into small amount of savings I was going to put towards IVA in order to get my car sorted before hand. I would like to sell it or exchange it in for something similar in price, or not much more expensive, but much more reliable and possibly a couple of years younger and with less milage. Possibly also one that will be on lower tax bands and insurance groups and have better fuel economy.

This is something I am thinking about greatly at the moment as I need my car for work and other essential personal reasons. I can't afford to be without it. I have had to use public transport recently and also sometimes walk as well when I ran out of money which is a nightmare because public transport is more expensive and unreliable, and I live quite a distance from my work (5 miles there and back). I may have to dip into the small savings I have in order to sort that situation out ahead of an IVA, which should also help reduce my future expenditure in those areas.

I think it may also be an idea for one or two months before I start the whole IVA process to cancel all payments out to creditors in order to build up a reserve, or to reduce drastically to just a token payment (Thinking about interest and charges not increasing the debt too much). Maybe pay just enough so that the debt doesn't increase after interest and charges (paying estimated interest only).

I think a lot of other people in an IVA must have encountered this issue as well in not having built up enough reserve to pay for bigger costs like these.

Useful tip: When applying for my IVA, I 'maxed out' all the existing credit cards/overdrafts accounts to build a small contingency fund - came to about £800 in the end (used it to open the new bank account with). Glad I did, as the car cost me £600 in repairs/service/MOT in December (exceeding my 'allowance' for repairs/servicing by a considerable margin) .

Any savings you already have will be swallowed up in the IVA, so I suggest you withdraw the lot & close the account (I assume these savings will not make a significant dent in your debts, and we are talking about a relatively small amount?), prior to the application process. You can at least presumably, use the available funds to sort the car.

This may help avert the issues faced by the OP.

milliemonster

You can always just pay for 6 months car tax instead of the full year for the time being? without being harsh you must have known when your car tax was going to be due before the IVA started?, I am in one myself so I do appreciate how hard it can be, the first few months are the hardest, especially if you are not used to budgeting, but the key to success is really having foresight and planning.

Cars are a pain in an IVA as the allowances they set you to start with are totally unrealistic with real life! fortunately once you get to review time, they will increase your allowances beyond what the guidelines say if you have evidence of what you have actually spent so your next year should get easier.

UpToMyNeckInIt

Tip: Well worth downloading (free), Microsoft Money. Very useful for budgeting.

FiatFan_2

I can sympathise a little as we've just had to put a third tyre (£135) on our car since starting our iva due to hitting a pot hole. Similarly we hadn't enough in the 'car servicing' fund so have had to juggle a little but could you not take if from something other than housekeeping, clothes/fuel etc?

Is the £118 for 6 or 12mths and is it due end Dec or end Jan? I know I'll just be putting 6mth on now come end of Jan when ours is due.

We're only 4 payments so just a couple months ahead of you, can definitely see the benefits and know it will get easier through 2013.