How to budget on monthly and 4 weekly payments

indigowarrior

Due to mental health issues I am claiming UC and PIP. I get UC on the 21st and PIP every 4 weeks (my next payment is due on the 14th of the month). I pay all my DDs monthly on the 22nd.

Am I better doing my budget from the 21st?

Willing2Learn

Just as a headsup, you should have your DDs set up for 3-4 days after you receive your UC. This is because UC (or any other automated payment) has the potential to be delayed if there is a gremlin in the payments system. On that basis, I would have all the DDs set up for the 25th of each month.

A monthly budget should work regardless of the day of the month the budgetary cycle begins. I would therefore have the monthly budget being calculated from the 1st of every month. What method are you using to budget? Are you using any software?

enthusiasticsaver

As your UC is on a fixed date monthly I would set up all your direct debits to come out a few days after the due date and as willing says maybe 25th or 26th rather than 22nd in case the UC is delayed.

You can still reset your budget on 22nd after your UC has gone through and you presumably know when your next PIP payment is due.

badmemory

I agree that 4 weekly payments can be a pain in the proverbial. If it is financially possible for you to consider that it always arrives on say the 24th of the month it can make budgeting easier & that way you get one "free" month (well 4 weeks), which could help get an emergency fund.


I can understand that when many state benefits were paid weekly as were many bills such as rent then that was fine. However many state banefits including state pension are usually paid 4 weekly when most bills (rent, electric, gas etc) are paid monthly. It really does not make sense.


I have noticed however that state pension forecasts now appear to state a "monthly" amount & I am hoping that this is a "future intention!" but not banking on it obviously.

indigowarrior

Yeah, it's tricky. I will look at possibly changing my direct debits if I am able. I know a lot of providers have set dates. Mind you I have been claiming UC for two years but, never had a late payment. Touchwood that doesn't change.

As for how I work out my budget, I usually use pen and paper but, I find it changes every month.

getmore4less

Budgets should be a plan for a full year covering all predicted income and outgoings.

When the money comes in is a cashflow problem.

Most spends are weekly, monthly, quarterly, yearly.

If the monthly income will cover the monthly spends then that is one way to manage those spends.

Then use the 4 weeks pay to cover the weekly spends.

From both will be the need to put money away for the other spends.
If you just do month to month these costs will catch you out.

enthusiasticsaver

indigowarrior wrote: »

Yeah, it's tricky. I will look at possibly changing my direct debits if I am able. I know a lot of providers have set dates. Mind you I have been claiming UC for two years but, never had a late payment. Touchwood that doesn't change.

As for how I work out my budget, I usually use pen and paper but, I find it changes every month.

If they won't change the dates of the direct debits then I would look at saving a buffer. Do you have any emergency savings?

Robbie64

I know you haven't asked about getting your benefit more frequently but if you were to consider doing so... You can ask for your Universal Credit (but not your PIP) to be paid more than once a month. If you live in Northern Ireland it's twice a month by default and in Scotland you simply have to ask to get it paid twice a month. In England and Wales you can ask for more frequent payments if you struggle with a monthly payment. You have to give good reasons why you would need to be paid more frequently but someone with mental health problems (especially if severe) would usually be treated to a favourable decision if they are classed as vulnerable.


See https://www.gov.uk/government/publications/universal-credit-and-rented-housing--2/alternative-payment-arrangements .


The standard more frequent payment is twice monthly but you can ask for it to be as frequent as weekly. The situation is supposed to be reviewed after a while (6 months or a year, I forget which and again only in England and Wales). The alternative payment arrangement can be paying any rent direct to the landlord or paying your money more frequently or a mix of the two.


If you can stay on monthly payments it would be better as you seem to pay everything by Direct Debit. It's better if you can develop good budgeting skills though the amount you are expected to live on (i.e. the amount of UC you get) is shockingly low. One final thing to consider - if you do opt for a more frequent payment of UC then there is no buffer period where you get the full amount of UC before it goes down. For example if you are going to get UC twice monthly and using this example, it's twice a month and your payment usually goes in on the 1st and your UC is £500 a month. You would have to wait until your next payday but would only get £250 with the other £250 being paid on the 15th.


PIP can only be paid more frequently (weekly in fact and paid in advance) if you are terminally ill otherwise it's every 4 weeks in arrears.

indigowarrior

I did ask to get my benefit frequently but, they said they would only do it if they could pay the landlord directly. From what I know from Universal Credit Essentials this isn't a good idea as it can increase the risk of arrears. I have no problem paying the rent so decided to stay monthly.

Thanks, everyone for the advice.

Robbie64

indigowarrior wrote: »

I did ask to get my benefit frequently but, they said they would only do it if they could pay the landlord directly. From what I know from Universal Credit Essentials this isn't a good idea as it can increase the risk of arrears. I have no problem paying the rent so decided to stay monthly.

Thanks, everyone for the advice.

Yeah, I've seen examples mentioned of people waiting two months or more for a landlord to receive a rent payment direct from the DWP which puts the tenancy at risk. Local councils and Housing Associations might be able to wait that long for payments to come through but most private landlords can't do that and the next thing you know is that the landlord is issuing a Notice Of Seeking Possession or whatever it's called these days.

NedS

indigowarrior wrote: »

I did ask to get my benefit frequently but, they said they would only do it if they could pay the landlord directly. From what I know from Universal Credit Essentials this isn't a good idea as it can increase the risk of arrears. I have no problem paying the rent so decided to stay monthly.

That is correct. It falls under Alternative Payment Arrangements, and they are tiered. The first tier is direct payments to landlord, and the second tier is more frequent (split fortnightly) payments to the claimant. You can not have more frequent payments to the claimant without already having direct payments to landlords in place - it's just how the system works.