Disposable Income

[sharonc30]

One thing that has been bugging me since we entered into the IVA in 2006 is the issue of disposable income
When you get a payrise, at the time you only have to pay half into the IVA. However when they complete the Annual Review they take it all from you, as the disposable income is recalculated. There doesnt seem to be any real incentive to better yourself to earn more as in the end the IVA get it all anyway.
Should it work like this or have I got it all wrong. I work full time, earn nearly 22k a year but after 3 years apart from 35k paid into the IVA and a struggling relationship I dont have much to show for doing so well at work

[Max]

As I understand it there is an obligation to pay the creditors as much as possible for they have given up something too. To show for it - yes you do - you can take pride the fact you are honouring your obligations. I am sorry your relationship is struggling but your partner should be proud of you. J

[Adam Davies]

Hi
This is an area that we have debated long and hard on this forum.
I can understand your feelings
The only way to look at it is that once your IVA has concluded you will have all the disposible income to yourself, would have paid your creditors more than expected and also improved your career progression.
It would be wrong to put your career on hold because of your IVA.
Regards

[ivas4us]

thats a really good way of putting it Andy. What we need to remember that it us that owed the creditors in the first instance. Yes your proposal might originnally estimate 20p in the £ but at the end of the day if you pay 40p in the £ the creditors have still lost out on 60p in the £ and all the interest.

[MelanieGiles]

There has to be a fairness about annual reviews, which allows people to benefit a little from their labours and thus leaving them with a sense of worth. This is vitally important - and in my direct experience leads to eventual success which creditor directly benefit from as well.

[ivas4us]

I agree Melanie, I dont think anybody in an IVA should look at how much extra you pay into the iva if you get a pay rise or promotion etc. As long as the payment is still affordable it shouldn't reflect on the decision to better yourself.