Now that it looks like my IVA will be approved, I'm thinking about how to reduce my costs to free up some income.
However, if I manage to do this, will my allowances be reduced after the first annual review?
I know that variable costs like food and groceries are not 'monitored', in that you can spend the allowance as you like, but what about other costs? For example, if I have an allowance of £x per month for car insurance and I manage to get a better renewal quote, will my allowance be reduced in year two? The same would apply to electricity - if I manage to reduce my usage and the monthly direct debit is therefore reduced, will I find that my electricity allowance is reduced in year two?
I need to establish whether sitting on the sofa in six jumpers will result in extra wine rations, or simply mean that I have no choice but to freeze to death the following year with no wine.....! [:D]
The best thing to do is tell your IP if some of the things go down drastically as you probably would be expected to pay extra across and it's best to be honest.
However, don't forget that other things like food, petrol, car tax etc will go up so you would probably be ok anyway.
If you can manage to save any money from your allowances, I'd open a savings account and put it in there for a rainy day. Quite a lot of people do that if they can.
Sharing from experiences of dealing with debt
The greatness of a man is not in how much wealth he acquires, but in his integrity and his ability to affect those around him positively.
Bob Marley. http://kallis3.blogs.iva.co.uk
Always be honest at your review at how much your outgoings and incomings are is my only advice. Like Jan says a lot of things go up and we make savings on other things but one normally negates the other.
IVA final payment left the bank on the 26th January 2013...looking forward to a debt free future.
If you do make a few savings on things like insurance policies you should just add the savings made to your housekeeping or contingency allowances at the annual review stage. Given that the savings would not normally be huge anyway it is not a problem as it improves the viability of the IVA.
If the income and expenditure statement is done correctly at the outset, there should not be the need for any major changes - but you do have to be honest with your IP at the annual review stage and declare true income and expenditure based on what you actually spend. Some IPs will check also check this to bank statements.
I see - I wasn't suggesting doing anything underhand, or being dishonest in any way. I was really thinking of whether it would be possible to cut back on 'allowed' costs (and suffer whatever discomfort!) in order to free up some budget for costs that wouldn't be allowed and included in the I&E statement. For example, I'd like to spend more on my dogs than is officially 'allowed'. Also, I have to stop smoking as no allowance is made for tobacco, so I would like to free up some money for patches, or prescription charges if I got them from my GP. There are a few things that I would happily try and cut genuine costs in other areas to fund, but I don't intend to do it in a covert way if it's not allowed.
If you can juggle within your budget then that is down to you to do. Your IP will not scrutinise every transaction, and you are allowed to live your life without too much interference from us!
We all try to do a little juggling with our allowances I think. For example, we bulk buy our tinned dog food from Costco as it works out a lot cheaper, so to do that, we don't spend all of our food allowance for that week (the amount we get costs about £25).
We've always got the cupboards and the freezer fully stocked anyway, so we don't miss it.
Sharing from experiences of dealing with debt
The greatness of a man is not in how much wealth he acquires, but in his integrity and his ability to affect those around him positively.
Bob Marley. http://kallis3.blogs.iva.co.uk
How long will that take you to use up Jan? My hound has just developed a taste for Butcher's Choice bought for her by Daddy!! Hellishly expensive, but she does really enjoy it!
We buy Butchers (don't know if that is the same as Butchers Choice) - the huge cans, and at Costco they are 50% extra free at the moment. The last time we went we bought four packs which have six cans in and they have half a can between them plus mixer each day. They will last us 48 days, so it does pay us to buy it this way.
Sharing from experiences of dealing with debt
The greatness of a man is not in how much wealth he acquires, but in his integrity and his ability to affect those around him positively.
Bob Marley. http://kallis3.blogs.iva.co.uk
1) Stop smoking
2) Stop drinking
3) No late nights, in bed by 9.30pm.
You may not live any longer but it will feel like it.
Aucto Splendore Resurgo.
IVA accepted May 2007.
Extended by 12 months in lieu of equity March 2012.
F+F offer accepted May 2012.
C of C received August 2012.
IVA dropped off credit file 24th May 2013.
Sharing from experiences of dealing with debt
The greatness of a man is not in how much wealth he acquires, but in his integrity and his ability to affect those around him positively.
Bob Marley. http://kallis3.blogs.iva.co.uk
This is partly why I need to do some budget juggling, as my dogs have never got on well with commercial dog food. Hence, they have fresh meat and vegetables with a handful of Burns dry food. As the fresh meat and vegetables are bought from the butcher and farm shop alongside my own meagre rations (!) I find it very hard to pin down exactly how much I spend on them! It has shown me over the years that the idea of supermarkets being cheap is an illusion - using the butcher and farm shop gives me far better food at a similar or lower price. I'm quite obsessed about things like this, in case you hadn't guessed!
