my Direct debts

kimplus8

I also get some money weekly and some 4 weekly so I have all my DD's and SO's coming out on 1st of months then pay an amount from each of my weekly amounts into the account to cover the cost and it is there to cover the payments.
if that makes sense.
e.g. if my DD's came to £100 due out on the first of January, then I would pay £25 a week into that account over 4 weeks in December to cover it.
If it is a 5 week month then I pay £20 per week to cover the £100.

Bendy1224

Thanks for your message mate, much help there . The problem I have is I have two lots of income going to bills account, which one pays much more than I need to cover bills. Also when it comes to putting money away how would you recommend I do it? I have a ISA, and a everyday saver. Would you say it’s best not to put in ISA just in case you have to take out and lose your personal allowance on savings? Hope this makes sense.

Cheers

Ben

Terry_Towelling

Bendy1224 wrote: »

Hi Terry, thanks for your message.

I do have a credit card ive recently just used it.

When it comes to my bills tho would you say to set the same date every month for my bills to come out then I know whats rest of my money in bills account I can take . Hope this makes sense. Also would you set the source of income I get every week to every 4 weeks like the other income thats coming into bills account??

Ben

Getting a bit confused here, Ben. OK, first things first. Why do you feel the need to have 2 current accounts? At this stage of your journey into managing your finances it is only going to make matters more confusing.

If you just have one current account, you don't need to transfer anything anywhere to make sure your bills are covered and there is less chance of making a mistake and having a DDR payment refused because you overlooked or forgot something.

On the subject of getting all your DDRs on the same day, that might make budgeting more straightforward for you but you won't be able to do this because companies only have certain days when they collect DDR payments. You might be able to get them close together but that's about all.

If you are going to use your credit card for all your day-to-day stuff (petrol, food, clothes etc) then that does make sense but only if you pay the card balance off in full by DDR after the card company has sent you your statement. You will need to tell the card company that is what you want to do and they will tell you each month when they intend to take payment from you and how much they will be taking.

You will, of course, need to keep track of what you are putting on your credit card because you know it is all going to have to be paid in about a month's time. Are you happy you can do this and are you completely sure you know how the credit card system works?

Once you have got things set up and become more familiar with your regime (say after 2 or 3 months) you can start thinking about how to save any excess money and where best to put it.

Dobbibill

Bendy1224 wrote: »

Thanks for your message mate, much help there . The problem I have is I have two lots of income going to bills account, which one pays much more than I need to cover bills.

Hi Ben,

-If you take your 4 weekly income x it by 13 then divide it by 12 that will give you an average of what it is monthly.

-Add your monthly income to the result of the above.
EG - £400 every 4 weeks x 13 (£5200) divided by 12 = £433.33
plus £500 every month = £933.33
-Then take away your monthly bills EG £933.33 minus *£460 (*made up figure for your bills) = £473.33

On the date your monthly pay comes in make sure the £460 is left in the account, take out the £473.33 figure for your spending account.

Also when it comes to putting money away how would you recommend I do it? I have a ISA, and a everyday saver. Would you say it’s best not to put in ISA just in case you have to take out and lose your personal allowance on savings? Hope this makes sense.
Cheers
Ben

You can now replenish ISA withdrawals if it's done in the same tax year so I wouldn't let that worry you.
For the moment I would use whichever savings you have to get into a routine.
It will all fall into place once you start getting into a routine with it.

Bendy1224

hello all,

Apologies if i'm confusing you all. basically the reason i decided to set up two accounts was to transfer my money i have coming in which don't need covering for bills to go into that account then i know thats for what i want to spend, obviously taking into account of food, petrol etc which are essentials.

i have written down all my bills several times now on paper but just seemed so over whelmed and confused with it all. i'm not sure if i'm wrong in saying this but i suppose with one income coming into bills account every week then the other every 4 weeks, also having 3 sources of income is going to make things confusing knowing what to put into spending account.

[do you think i should still have two accounts based on what i've explained?]

hope i've made sense on my post this time round lol and been more clearer. would be nice if some of you could help me out via a app called Discord which is free on apple IOS and Android store and to help others so we can all manage our money better. i can link the app in if your interested in doing this.

also regarding the tax allowance as didn't quite understand what you ment by your reply, on ISA'S what i was referring to was just say i had £19,000 left on personal allowance for tax year because i put in £100 to account, but then moved that money to another account, my tax allowance wouldn't replenish would it? it would still stay the same at £19,000

cheers Ben...

elsien

If you want 2 accounts and it's working for you, then it's fine to carry on. Regardless of what a previous poster suggested, I'm a single person but running the both works well for me.

Forget the income streams for a minute, have you sat down and worked out your bills over the year as a starting point? Do you know how much they average for a calendar month?

Dobbibill

With 3 incomes I would say it is easier to have 2 accounts. The bills account being where all incomes are put - the 2nd account for your spending /fuel/grocery money etc.
You just need to pick one date in the month as 'pay day' - the date your monthly income comes in would probably be the easiest.

The SOA template above should help.

Some Cash ISAs can now allow you to withdraw money and pay it back in without losing your allowance if it's done within the same tax year - ie if you do it by April.

https://www.moneysavingexpert.com/savings/best-cash-isa/ point number 2 explains this.

Terry_Towelling

elsien wrote: »

If you want 2 accounts and it's working for you, then it's fine to carry on. Regardless of what a previous poster suggested, I'm a single person but running the both works well for me.

Agreed - two accounts is fine - but OP has stated they are new to 'this money stuff' and having two accounts doesn't seem to be working for them because they are struggling to work out what to transfer out in excess of the bills amount.

Surely, it would be easier to get settled with a single account for a while and when they have become comfortable with the whole process of budgeting and a pattern has emerged, then it might be OK to start expanding the accounts.

Many of the posters on the forum will have multiple accounts to manage their money but they will have evolved into that position rather than started out that way. One might also argue that it is probably more logical to have the income paid into a 'personal spending' account and to transfer an amount to cover the bills into a bills account rather than the way OP is proposing - but I can see reasons for doing it either way.

Anyway, there is no point us all disagreeing about this because that will just confuse things for OP. If they want two accounts, fine, but you are going to have to be very prescriptive in how you advise them to manage those accounts. Ideally, OP needs to sit down with someone to get it all sorted but we can't do that on this forum.

Bendy1224

Hey all thanks for your posts. Is all my post showing I done most recently as some of the things I posted you peeps on here haven’t responded too.

Would be much grateful if you could help me on a free talking app called discord which is available on Android and Apple IOS, as not too good with understanding things over text. Can provide link if interested.

Also the date is going to change each month isn’t it as get paid every 4 weeks, so for example one month it could be on the 10th of the month then the following month it could be on the 12th. How should I set bills for DD’s for being paid 4 weekly. Also my second income which I receive in my bills account she’ll I chanage that to every 4 weeks like all the rest. Hope I’m being more clearer lol.

Cheers Ben

Terry_Towelling

Bendy1224 wrote: »

Would be much grateful if you could help me on a free talking app called discord which is available on Android and Apple IOS, as not too good with understanding things over text. Can provide link if interested.

Also the date is going to change each month isn’t it as get paid every 4 weeks, so for example one month it could be on the 10th of the month then the following month it could be on the 12th. How should I set bills for DD’s for being paid 4 weekly. Also my second income which I receive in my bills account she’ll I chanage that to every 4 weeks like all the rest. Hope I’m being more clearer lol.

No idea about the discord app.

On the subject of being paid every 28 days, it isn't as simple as just adding 28 days to your last payment to find your next one because there will be bank holidays and weekends mixed in. Do you know how payments will be made if 'payday' falls on one of those dates? Try using a calendar and mark on it every 4 weeks so you know when payday will fall - subject to the weekend/bank hol arrangements.

To some degree it doesn't matter when you set the direct debits to go out, you just need to make sure there is enough money in the account at the start of the month to cover the bills amount. Other posts here have suggested you work out how much your bills are each month, and I see you have said that to be quite challenging, but that really is the crux of the matter here; you need to work out what all the bills come to before you do anything. You need to write it all down.

This is one of the reasons why I suggested you only have one account with all of your money in it. That way the risk of not having enough money in to cover your bills more or less goes away. Get settled with the way the account works and how the money comes in and how the bills are paid before getting too ambitious with multiple accounts.