Budgeting - and completing your Income and Expenditure / Financial Statement form.

[Amethyst]

If you are making an offer to pay by installment at a rate that is lower than the contractual rate, or entering an admission/offer to pay, or application for a time order, administration order, or claiming hardship in a charges claim you will need to submit a full Financial statement detailing your current circumstances.

Completing a Financial Statement can also assist you with prioritisng your outgoings and assist you in making decisions and changes to your spending.

Legal Beagles Income and Expenditure form is a simple straightforward way of doing this. You can find this form here.

The form has different categories to cover your total household expenditure.

• become aware of how much money is coming into and going out of your household;
• work out how much money you have left to pay off your debts;
• plan affordable offers to creditors; and
• take control of your future spending.

You can complete a draft and post it in the debt forum to ask others for advice and support with your budgeting, and you can complete the form with your accurate information to send to your creditors when asking for changes to your payments.

Before you begin you need to decide who you are preparing the budget for.

For example:

• If you live with a partner, are you going to prepare a joint budget?
• If you have any non-dependants living with you how will you treat their income and outgoings?

A non-dependant is someone who lives with you such as grown-up children and
elderly relatives. If they are included in your outgoings they should be contributing to the household income as well.



INCOME
ESSENTIAL EXPENDITURE
OTHER EXPENDITURE
PRIORITY DEBTS
NON PRIORITY DEBTS

[Amethyst]

Re: Budgeting - and completing your Income and Expenditure / financial statement form

First step to cover is your Income.

This will include all your wages, salary, benefits, tax credits and any other income your receive.

You should include your wages and salary after deductions for tax, National Insurance
and pension contributions (that is, your normal take-home pay). Only include overtime
payments if you receive these on a regular basis.


You can check you are receiving all the benefits you are entitled to claim at Start Calculation
if you are unsure you can make a post in the BENEFITS forum and ask for advice and support.

If you receive Housing Benefit and/or Council Tax Benefits you should include these figures in your Income.

If you receive Free School Dinners you do not need to include those figures in your income or expenditures.

If any non-dependants make payments to your for rent/keep you should include these. You should also include any regular income from investments and savings.


BENEFITS are sometimes paid every FOUR WEEKS - you will need to work this out to a monthly or weekly figure.

If you need to change a four-weekly figure to a monthly figure use:
Four-weekly figure x 13 (payments) divided by 12 (months).


You need to complete the following information:

Wages or salary (net after deductions)
Partner’s wages or salary (net)
Tips or commission
Maintenance/Child support
Own and/or partner’s pension
Income Support
Jobseeker’s Allowance
Working Tax Credit
Children’s Tax Credit
Child Benefit
Other Benefit Income
Interest
Other income (Specify)

[Amethyst]

Re: Budgeting - and completing your Income and Expenditure / financial statement form

Second step to cover is your EXPENDITURE

This covers your day to day living expenses. You need to complete the entire form with either MONTHLY or WEEKLY figures. Do not switch between the two.

If you pay your rent weekly, and your council tax monthly, you will need to decide whether to recalculate to monthly or weekly figures. It is usually easiest to budget for the same periods that you receive income. Most people who receive benefits will calculate their budget weekly, and most people who are in employment will calculate monthly.

To convert weekly figures to monthly figures
Weekly figure x 52 (weeks) divided by 12 (months).

To convert monthly figures to weekly figures
Monthly figure x 12 (months) divided by 52 (weeks).

Some of these are considered ESSENTIAL - such as Mortgage or Rent, Utilities and Council Tax.

You should use the exact figures you pay for these in your form and if possible have evidence of these outgoings availble.


You will need to complete figures for:

Mortgage payment
Rent
Mortgage endowment payments
Council Tax
Service charge or ground rent
Buildings / contents house insurance
Life insurance
Water rates
Gas
Electricity

[Amethyst]

Re: Budgeting - and completing your Income and Expenditure / financial statement form

The next step to cover is your Other Expenditure

This is likely to contain some figures which may vary from week to week. You should try and work out an average figure.

There are no right and wrong figures, but these are the areas that can be looked at to adjust your spending to suit your available income.


Telephone (including mobiles)
Include line rental, average call costs etc, If you have a mobile include your contract payment or average top ups.


Food & drink / Housekeeping
Work out what you usually spend on your weekly/monthly shop for all food, drinks...also include those little trips to the corner shop for milk, bread etc.


Newspapers & magazines

TV. licence & rental
include any subscription services, such as sky. If your TV is on HP do not include that in this section it will come under creditors later on.

Childcare (include pocket money/ trips)

School meals
if you receive free school meals then leave this blank

Entertainment (include hobbies)

Holidays
If you have one holiday a year how is it paid for ? If you spend say £500 on a holiday each year then break that to a monthly/weekly figure by dividing by 12 or 52.

Pets (food & vet’s bills, insurance)

Cigarettes

Presents- Birthdays, Christmas etc

Travel & fares
taxis, buses, trains etc

Car tax
Petrol
Car insurance
Car service & repairs
MOT

Clothes & shoes

Household items (repairs etc)

Health costs (e.g. dentist, eye tests)

Maintenance payments
include any maintenance contracts you have here

Savings & Pension plans
any regular payments out to savings or pensions

[Amethyst]

Re: Budgeting - and completing your Income and Expenditure / financial statement form

Next step is the painful bit for many of us. You need to complete these sections honestly and as accurately as possible.


PRIORITY DEBTS

These are debts which MUST be paid - such as council tax arrears, secured loans, court judgements, utilities arrears - debts which would cause extreme problems if they werent paid and could lead to imprisonment, bailiffs, loss of essential utilities or the loss of your home.

We can still look at amending the installment amounts on these figures but the process is much more formal than for unsecured creditors such as credit cards and unsecured loans. You may also have VAT/Income Tax arrears which you should include in OTHER and specify the debt.

You will need to enter the total amount outstanding and the monthly/weekly repayment rates.

Mortgage arrears
Second mortgage / secured loan arrears
Rent arrears
Council tax arrears
Fuel debts: Gas : Electricity :
Magistrates' Court fine arrears
Maintenance arrears
Hire Purchase arrears

[Amethyst]

Re: Budgeting - and completing your Income and Expenditure / financial statement form

Non Priority Debts

These include lots of different types of debts where the creditor hasn’t got extra powers (for example, they cannot take your home).This means they do not have to be treated as a priority, and you can make offers to pay at a lower rate depending on your overall circumstances.

The most common credit debts include:

Credit-card debts
Personal loans with finance companies
Bank and building society loans, overdrafts and credit cards
Charge/Store cards
Catalogues
Personal debts to friends and family
Doorstep-collected loans
Credit sale agreements


You should list EVERY debt and the total amount outstanding.

If you post this section in the debt forum there may be ways others can help and support you dealing with some of these debts. Any issues with the debts should be posted in the forum. Include everything - for example if you have an overdraft on your current account yet are reclaiming charges from it, include the ENTIRE overdraft. Do not count on any refunds etc when detailing your debts.

YOU WILL NOT BE JUDGED whether your debt be £100 or £100,000. We will help and support you and be able to suggest different actions you may be able to take with regards your debts.

The Legal Beagles Spreadsheet will automatically work out what monthly payments you can afford to pay these creditors. This is worked out proportionally and would be similar figures if you entered a formal debt management plan with a charity such as Consumer Credit Counselling Service.

Once you have completed your form and if you have any queries regarding it, please make a post in our Debt Forums

If you would like to keep your information private then you can send your form by email to a team member, but please contact them and discuss your issues first. We would however encourage you to post on the forum, if you are a VIP Member you can use our Managing your Finances forum which will enable you to post in relative privacy. It often helps to get things written down if you feel you are struggling to cope, and you will receive lots of support and help from many people who are and who have previously been struggling with debt.

The Budget Sheet will not show your entire situation, and although it may sound nosey we need as much information as possible to be able to help with your overall financial situation.

Remember posts on the forum are anonymous and only allocated to your user name. Do not include account numbers, real names and addresses on the form if you are posting it on the forum.

Our team members have access to a range of information and experiences to assist you with the form and your budgeting so please feel free to ask.