Affordable Budget?

Arnak

Hi,

My wife and I are pensioners and we are in debt to the amount of approx £25000 plus the mortgage.

At the moment we are not in any arrears but as every month goes by we are having to use more of our banks overdraft facility which is nearly exhausted.:(

We have contacted Step Change who have been very helpful up to a point.

However their idea of a an affordable DMP is not what we agree with as it leaves us really short each week and we would have to struggle for every penny.

Both of use have clinical depression and at out ages, 67 and 72 we are not stable enough to cope with the amount of stress required to deal with such a harsh DMP.

So my question is what is an affordable amount, obviously their opinion and ours differ by quite a large amount.

I would welcome any comments or suggestions and can give more details if required.

Thanks for any help or advice anyone can give.

Martin

DCFC79

Why not post up an SOA and others can help.

Phone 1 of the other debt charities and see what they say.

theoretica

An affordable amount for what? To cover all bills including electricity and council tax, or just food and discretionary spending? The problem is that as a pensioner you have more time in each day to be spending money, rather than being at work and not spending, and many people have a lower income in retirement.

Look very carefully at your spending first for things which you can cut down without impacting on your living standard - things like being on the best deal for insurances and utilities.

Arnak

Hi Charlie,

Thanks for the reply.:D

I will post an SOA.

I have contacted Step Change but in my opinion they are totally unrealistic in what they consider to be an affordable budget as cutting down or more accurately cutting out is not what I consider reasonable.:(

Theoretica,

I'm sorry but I found your post to be unhelpful, of course I have tried everything to reduce our outgoings, including checking for cheaper utilities.

With regards to your comment about having more time to spend wheh retired, that may be the case but it is not what we are doing.

We are spending as little as we can!

Naturally having less to spend when retired is indeed the case with us and we fully accept that and are happy to do so.

By affordable I mean enough to cover all the bills and have a little left over for discretionary spending and some to save for emergencies.

We do not take holidays or go out to pubs and clubs etc.

Our Nissan Micra car is 10 years old and worn out so we watch TV and we have the internet.

The list of things we don't spend on is far longer that the list of what we do spend on.:eek:

To follow Step Changes DMP would make life not worth living at all.:shocked:

Personally that is something we have considered, I am awaiting an appointment with a psychiatrist for help with my clinical depression which is not being improved with this debt crisis.

Additionally I am looking for work as a Handyman to increase our income but times are hard and people cannot afford to have work done at the moment nor does working help my mental state.

Perhaps that gives you a slightly better idea of our situation?

I do appreciate that you meant to be helpful in your reply but not all peoples difficulties lend themselves to simplistic answers.

Martin

enthusiasticsaver

There is no one figure for an affordable budget as everyone's circumstances are different. However a DMP is very closely budgeted which is why you say there is no leeway. There should be an allowance for saving for emergencies though and you should also have an entertainment figure in there. How much though depends on how much you receive each month and how much debt you have and income spare after paying for essentials - mortgage, utilities, food. If you post an soa and tell us how much stepchange want to leave you with each month then it would be easier to comment.

Coping with debt and reduced income is tough and a long journey but unfortunately there are no short cuts. Is selling the house and downsizing an option to get rid of the mortgage at least?

Arnak

Hi Enthusiasticsaver,

Thanks for the reply.;)

I will get around to posting an SOA as soon as I can.

With regards to selling the house and downsizing, I'm afraid that is not possible as the amount we would have left, about £35,000 would not be enough to get any sort of house.

I do accept that the budget has to be tight but Step Change were ridiculous in that there was no entertainment budget except for a basic tv channels and for clothing they said £25 per year!!!!!

A new pair of wellies for the winter would be £10, the old one's have a hole in them.:(

The other day I brought 5 pairs of socks for £8, the old ones were full of holes and worn right through.

That's £18 out of our years clothing budget.:eek:

Then I had to re-stain the decking as without doing so the decking would go rotten, £22 for 2.5 litres of stain...

The list goes on....

They do not seem to have any idea regarding the real cost of living these days.

I could go on but it wouldn't do any good as it will just get me upset and very down.

Martin

so_very_confused

Hi Arnak

Can I suggest what many of us do on DMPs?

Log in online do the budget there and play around with the figures until you feel you have enough to live on.
The £25 you are referring to for clothes is actually monthly allowance.
You may need to claim for cigs you smoke, dry cleaning those winter clothes ,curtains. Can you manage your garden? You might put in additional £15 per month for this.
Do you have pets?
You have an old car so go for the top allowance for maintenance.
You appear not to have an emergency fund did they suggest you making token payments to creditors until you have on? This is worth looking at.

I believe you can get a pretty reasonable budget if you work at it. I don't believe you should be cut to the bone on everything. That is ok for younger folk but you need to enjoy your life as it is now.
If you are both at home and can use the internet maybe worth visiting the Boost your income board.
Whatever you decide good luck.

I am sure there will be others along who can expand on my advice.

kindofagilr

Do you receive Pension Credit? if not have you looked into whether you are able to claim it? As we can also help with mortgage payments.

As others have said if you can post a SOA up then the lovely people here might be able to help with that

Grumpelstiltskin

OP please give us more information.


How have you got into the position where you are retired and still have a mortgage and only £35.000 equity in the house?


Do you check online for prices before you buy anything? A quick look online shows Decking Stain at a price less than you paid.

theoretica

Arnak wrote: »

Theoretica,

I'm sorry but I found your post to be unhelpful, of course I have tried everything to reduce our outgoings, including checking for cheaper utilities.

I apologise for inadvertantly insulting you. Many people come on here before they have tried everything that is, to you, obvious. We really do need more information from you to offer the most relevant advice.

I agree with you and with so very confused that £25 a year is a very implausible figure for clothing for a year long term but more realistic per month. The DMP should also allow a bit for home maintenance. For a DMP you need to make a case for what you need and why they should support you in this.

System

Hi,
I'd recommend you look and have a read back at the DMP thread as it will be really helpful. You can go self managed - and set your SOA as you see fit - but some creditors may be tricky if they are not happy with your budget.

Good luck with your journey. It might also be worth going into see CAB in case they can also give you help as to other sources of benefit or income that you may be entitled to.

Good luck.