Do you struggle with dates of Pay day and direct debits?

Imladris

Hi, I'm one of the lurkers, but today I have a question.
Do many of you have real difficulty tying in an awkward salary payment schedule with due dates on direct debits? I'm wondering if it's just a few of us, or if the system is unfair towards those on low incomes and a change needs to be brought about.

For context, until last year, my husband had a string of jobs with awkward payday schedules. One was 4wkly, another was "manually around the 20th" and a third was weekly on Thursdays. We have three children, the second just started primary school and our youngest is 2. I am home with them, as a period of redundancy for my husband at the time I fell pregnant with eldest lastest the whole pregnancy and we fell onto the benefit trap.
(As in, once you are on things like housing benefit, any part time work I could try to do now youngest is 2 (we're not eligible for 2yo funding) would just replace the equivalent amount of benefit and not see us any better off, indeed we'd be worse off, as childcare would cost more than I'd earn as I'd be going back to living wage shift jobs like retail and catering. So we have to either wait till youngest in school, or get to the point we are off all benefits = benefit trap).
Trying to fit direct debits on around those sort of salary schedules was a nightmare! On the paid weekly on Thursdays job especially, rarely did the weekly pay amount to some of the bigger bills like rent and council tax or even food for a family of 5. I have done my research, and in spite of the direct debit mandate existing to give you power over when things leave your account; it is still entirely up to the service provider what date they want the payment. Companies like the TV license agency are fab, with options of 1st 7th 21st and 28th each month, but many only offer 1st or last working day each month, or a date in line with when in the month you joined them - we are now paid monthly on the last working day, so lining as much up to first of the month as possible, but some accounts like media or energy still have an approximate system of 3wks after your switch request making it hard to judge when to move to fall into the right payment due date.

They cannot force you to pay by direct debit, but when you fall behind some insist you set one up before reinstating your service (well, one specific company we took to ombudsman actually), and just trust they won't use it on the day they want which they did of course, every time resulted in late fees, dis- and re- connection fees and bnak charges for the last half of contract.

Whilst they are required to allow you to pay by another way, there are no rules about how, so several companies refused me standing order details so I could still have most of the bill paid automatically.
Similarly, there are no rules about how often an employer must pay you, as long as it's agreed on your contract and they aren't late.
Throw into there, that our child tax credits come weekly, housing fortnightly and child benefit 4wkly.....
We have enough money to live on a budget each month, but close and until more of our debts are cleared, no way to just leave £200-£1000 hanging around in there for a buffer as I have seen some threads instruct.....

As a result, we have lots of under £500 debts with energy or media suppliers, due to payments falling behind due to this complication, plus credit card debts where we had to supplement income most months. We made a lot of other mistakes too, through severe health issues for each of us, other circumstances, plus our age and lack of experience, but we are now under control again with the help of National debtline. This was also not helped by my own limitations as an adult female with ADHD and how that manifests. We should be clear in 3-5 years depending on what sort of part time work I can get once youngest gets her 3yo funding.

But I do wonder if all that was just us, or if many of those not paid monthly on the last Friday/working day also struggle. It strikes me that the jobs paid in more unusual ways are likely to be lower pay, smaller businesses and the like meaning the people struggling with the current system are already more likely to be in financial difficulty. So, is this a symptom of our own difficulties alone, or is it a common problem as I suspect and perhaps time for it to be looked into properly and see if something can be done?
(I'm thinking .gov petition if so btw).

Thanks everyone.

sourcrates

Hi,


Companies/creditors do provide various "ways to pay", but on the other hand, late payment charges form a large part of most companies profits.


Barclaycard, for example, once admitted through a freedom of information request to a national newspaper, that 40% of its annual profits came from charges of one sort or another.


So you can see the conflict of interest here, they say they want you to pay on time, but when you don't, or cant, they make more money from you, its a dog eat dog world.

Imladris

Sheesh. 40%! That's a very good point even if somewhat immoral. I never imagined it would be that high

MottledDebt

I had an issue with a couple of direct debits coming out on awkward dates, for example I get paid on the 25th of each month, and my internet and phone bill comes out on the 15th. I decided to just speak to both companies and find out what they could do. They let me change the date to suit me, I just had to pay a little extra on the first "new date bill" to cover the days between the original and new DD date.

natlie

Hi
Part of my income comes from self employment and the businesses we work with always pay on their terms, not ours - that's really hard as we don't know when we will ne paid. We have to cover up front costs as we do catering. My main employer pays on or just before the 20th this month will be a pain for me as I have £485 in outstanding payments from self employment and Barclaycard and Paypal have both got earlier than usual payment dates on them, Paypal usually comes out on the 21st will be 19 this month, BCard usually comes out on the 19th will be 16th this month - not sure why?

Nat

bilko89

I receive my monthly pay on the 18th of each month so understand what you are saying. But I have mobile phone bills, internet and tv bills and rent which all come off on the 20th for me (just incase!)after speaking to them all. Council Tax is the only sticky issue as their dates are set and can't be altered to suit (North Lanarkshire Council, Scotland) but I just pay them manually every month. You should try to speaking to them, I just explained my pay date.

-taff

If you set a proper budget for monthly expenditure, then it doesn't really matter what day you're paid on, because if you are recieving a wage, whatever dates the wages go in, plot in advance what your going to get. Then remove any monthly bills, what you're left with is what you can spend. Don't take out or spend any more than that and you should be fine.
That's the simplified version of doing it obviously, but it can be done.

System

DH was paid weekly until October. It was hard work trying to find the money for each bill and I often left us short (which is the start of our debt problem). I added up all of our direct debits for the month and divided them by 4. I put that amount away each week, plus a buffer, from his pay for direct debits. Now that he's monthly pay I just put the monthly total plus a buffer away for the month. In order to do this I needed a buffer in to help with those bigger direct debits. I know that things are hard when you're on a lower income and benefits can change regularly which is really frustrating. Just remember which bills are priority.

Lydia42

YNAB do a very good turorial on You tube explaining how to budget variable and weekly income. Worth a watch.

bertiewhite

Not since I started using a spreadsheet detailing incomings & outgoings, including known dd's.

Mumoffourkids

I have income coming in on different dates and different frequencies but I manage just fine. I think if you budget properly you shouldn't have an issue.

So for me I get paid from my job anywhere from 3rd of the month to 8th of the month. So my wages cover all my direct debits including my debt repayments when I was repaying my debt. Anything left used to go towards my rent.

I get tax credits and child benefit weekly so that covers food, petrol, pocket money and general spending fund (for any bits that crop up like school trips) and again any extra goes towards rent or nursery fees.

Then I get housing benefit fortnightly and that goes towards my rent.

Then I get two lots of maintenance weekly and that goes towards nursery fees.

I just worked out what was monthly expenses and what was weekly expenses and then worked out what income would cover what. Yes at times during the month I have money in my bank account but I know what it is allocated to. I also have a separate current account which I transfer my weekly spending money to. My main current account gets all the income in and then pays all the bills, rent and nursery fees. I know that the money in my main account is not for spending and only the spending money current account is what I can spend each week.