Advice on starting afresh

evherkes

Hi all,


Hope this is the right forum. I am about to proceed with an IVA and having made this decision I have come to the realisation I was never taught all the should/shouldn'ts of money, and maybe never wanted to either!


I have a bank account and receive regular wages and if the IVA is approved will have some bills but they affordable and necessary living bills.


So - I am after advice on:
* how people have managed to stay well-behaved with money burning a hole in their pocket
*how people split money into different accounts (one for bills, one for food etc) and what are the benefits they have seen from doing this
* any other useful advice they would give to someone from their own experience


I am not here to talk about the pro's & con's of an IVA or anything along those lines.


Thanks,

MallyGirl

some people use an app called you need a budget (YNAB), some run a spreadsheet, some use one of the online banks like Starling that (I think) allows you to set up virtual pots and allocate money into them.

Grumpelstiltskin

evherkes wrote: »

Hi all,


Hope this is the right forum. I am about to proceed with an IVA and having made this decision I have come to the realisation I was never taught all the should/shouldn'ts of money, and maybe never wanted to either!


I have a bank account and receive regular wages and if the IVA is approved will have some bills but they affordable and necessary living bills.


So - I am after advice on:
* how people have managed to stay well-behaved with money burning a hole in their pocket
*how people split money into different accounts (one for bills, one for food etc) and what are the benefits they have seen from doing this
* any other useful advice they would give to someone from their own experience


I am not here to talk about the pro's & con's of an IVA or anything along those lines.


Thanks,

I know you say you don't want to discuss the IVA are you 200% sure it is the best solution for you?

I hope you have received advice from an independent source and not just the IVA company.

evherkes

MallyGirl wrote: »

some people use an app called you need a budget (YNAB), some run a spreadsheet, some use one of the online banks like Starling that (I think) allows you to set up virtual pots and allocate money into them.

I looked at YNAB and it seemed to have a fee attached to it in order to use it - but I hope to explore this more if it is a free option.


Thank you for your advice.

evherkes

Grumpelstiltskin wrote: »

I know you say you don't want to discuss the IVA are you 200% sure it is the best solution for you?

I hope you have received advice from an independent source and not just the IVA company.

I have done quite a bit of reading myself from a variety of sources as well as "online assessments" through various organisations and I actually disagree with some of their "advice". Being honest a voluntary debt repayment option is not something that I can do, the amount is too high to be able to see a light at the end of the tunnel and will cause just as much financial impact but over a longer time frame. Bankruptcy means I will lose my car and in turn my job which is also a no-go. I feel IVA is my only option on the balance of all things considered.


Thank you for respecting my post and asking respectfully (no sarcasm - over the forum it can be hard to tell!)

monetxchange

I’ve seen a massive improvement in my spending when I allocated every penny of my income to a specific place so it’s where it should be. That way it’s never burning a hole in your pocket as such!

So I leave enough in my main account for bills and direct debits coming out. You need to work out how much you have coming out down to the penny to make this way of allocating money work. I use an Apple store app called simply Accounts to keep track - though any free app or an Excel spreadsheet would do the same. No need to pay.

Then I transfer my budgeted spending money for groceries, other shopping, transport, petrol, eating out etc into a Monzo account for day to day use. You can set budgets on Monzo (or others like Starling) so it’ll let you know how much you have left in the budget. I even split mine into four weeks and stick the other three weeks into a virtual pot in the app so it’s out of the way until it’s the week to be used. As all my other money has been allocated, there’s no way of overspending. When it’s gone, it’s gone.

I also allocate monthly amounts to more virtual pots in monzo for “one offs” like car MOT and insurance - stuff that comes up yearly or so but will need saving for when it comes up. These aren’t to be touched unless it’s time to use them for their specific purpose.

The rest of my monthly income goes between debt repayments and an overflow savings fund if I have a good month. You could use anything else to build up an emergency fund. The key is transferring it away from a spending account straight away so it doesn’t get frittered.

Willing2Learn

There is no free version of YNAB (except for the 34-day free trial period). I have been using YNAB for over 7 years. It has been so beneficial to me. By using their budget methodology (zero based budgeting), I have gone from a life of perpetual debt to now having a six-month Emergency Fund (budget buffer) and a very healthy pot of savings. I recommend it.

+++++++++++++

Lots of people on this forum have said positive things about Monzo bank and the way their app allows you to put money into different savings pots. Seriously positive feedback. It seems to have helped a lot of people to break their cycle of debt.


++++++++++++++


Also have you tried apps such as Emma or Yolt? Feedback on these apps has also been positive.

Unicorn_cottage

Hi there. Just want to check that you aren't paying for the IVA management service? That is my first thought.

As part of the process for deciding on an IVA I assume you have done a statement of affairs? This is often the very first step in addressing spending i.e. looking at were you are overspending - could be your tv package or groceries etc and making any necessary changes to make your money work for you such as moving from a mobile phone package to a sim only deal.

I tend to manage money by as soon as I get my wages I assign it to a job and any excess goes to debts straight away.

evherkes

Unicorn_cottage wrote: »

Hi there. Just want to check that you aren't paying for the IVA management service? That is my first thought.

As part of the process for deciding on an IVA I assume you have done a statement of affairs? This is often the very first step in addressing spending i.e. looking at were you are overspending - could be your tv package or groceries etc and making any necessary changes to make your money work for you such as moving from a mobile phone package to a sim only deal.

I tend to manage money by as soon as I get my wages I assign it to a job and any excess goes to debts straight away.

I have looked at my debts alone and the repayments are more than I earn. It is completely impossible for me to continue to pay them and there is no way I can save enough to even touch the sides.


Once the IVA is in place (if accepted) I am keen to look at assigning money which is why I am here looking at any specific tips, assignments etc. will be welcomed to get some good habits now for when the IVA is settled.


Thanks,

Unicorn_cottage

You will need to manage on a budget when and if the IVA is agreed but it may be that bankruptcy is one of your options. Have you tried these guys for advice? https://www.nationaldebtline.org/

evherkes

Unicorn_cottage wrote: »

You will need to manage on a budget when and if the IVA is agreed but it may be that bankruptcy is one of your options. Have you tried these guys for advice? https://www.nationaldebtline.org/

Unfortunately, bankruptcy is not an option as I would lose my car and then in turn my job so would have no source of income. I tried a couple of not for profit places and was unhappy/didn't agree with their suggestions as they seemed to follow a blanket suggestion which is personalised to what I need. They all said a debt repayment plan directly despite me making it clear I want a clear end date and no contact (door or otherwise) so I can draw a line under it and move on. Thank you though.