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England and Wales > Your Budget > Household Budget > Most Common Outgoings

Most Common Outgoings

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Mortgages and secured loans are usually paid monthly. Put the normal monthly payment for each mortgage on your budget. Do not include arrears at this point.

If you have an endowment mortgage, show the endowment or life assurance monthly premium separately and also enter the amount you pay the mortgage company – usually the interest only part.

Rent. Put your normal monthly or weekly payment here excluding arrears. Remember to see if you are entitled to any Housing Benefit.

Council Tax is usually paid in ten monthly instalments. You may be entitled to benefit if you can show the council that you are on a low income. You can apply for a reduction if you are the only adult in your home.

Water rates. Most water companies will accept monthly payments. Divide your normal yearly bill by 12 for the monthly amount and put that figure in your budget. You can also ask your water company if you can pay weekly if this helps you to budget.

Gas and electricity. Work out the cost of your bills over the year and divide the total by 12 for monthly and 52 for weekly payments. Phone the company and ask to pay monthly or weekly to suit your budgeting.

If you are struggling to pay your gas and electricity bills, the company may suggest that you have a pre-payment meter installed. These meters allow you to pay for the service as you use it and also to collect any arrears outstanding from previous bills.

Although some people find that this method suits their budgeting, if you are on a varying income, as are most self-employed people, there is always the danger that you may not have enough money to ‘feed’ the meter and in effect cut yourself off.

If you have a meter and you feel that you are paying too much, phone the company to check how it has been set and see if it can be re-set to what you can afford.

Provided you have a bank account, paying by a monthly direct-debit scheme may entitle you to a discount from the company, subject to your account being up-to-date.

There is a range of grants available for insulation, draught proofing, central heating and energy advice. You may be able to apply for a Home Energy Efficiency Scheme (HEES) grant depending on the benefits you receive and your age. In England the schemes include a warm front grant, in Wales a HEES grant. For more information call these Freephone numbers: 0800 316 6011 in England, 0800 316 2815 in Wales.

Housekeeping should include food, toiletries, cleaning materials etc. and a small amount for entertainment and miscellaneous expenditure. A rough guide would be as follows but please bear in mind that your expenditure may be different:

Single person	£152-195 per month
Couple	£260-325 per month
Each child	£87-£52 per month depending on age

Non-dependants such as children who have left school but still live with you or elderly relatives living with you should not be left out as they can make a difference to the cost of housekeeping. Whether or not they make a contribution, calculate their housekeeping costs at £87-152 per month.

When writing to creditors ensure that you advise them of the number of people in the household and also whether they are adults or children.

Telephone. Only include your ongoing bill. You should ask your phone company if you can pay in instalments. BT has a new payment card you can use at the post office or PayPoint outlets to pay towards your next bill.

If you have been disconnected, treat the bill as a secondary creditor. Ask about budget payments. If you agree a payment plan for your next bill, BT will let you keep an incoming calls only service.

Magistrates’ court fines. These are a priority and should be included in your essential outgoings. They are different from county court judgments, which should not be included here.

TV licence and rental. You should pay your TV licence as a priority because without one you could be fined in the magistrates’ court.

There is a 50% reduction if you are registered blind. The licence is free if you are over 75.

There are different ways of paying for your TV licence:

using PayPoint outlets in shops such as newsagents, supermarkets and convenience stores;
by Direct Debit either monthly or quarterly from your bank account. Contact the TV licensing customer enquiries on 0800 917 1490;
using a payment scheme called ‘cash easy entry’ with weekly or fortnightly payments if you are on Housing Benefit, Council Tax Benefit, Income Support/Income Based Jobseeker’s Allowance, Working Tax Credit or Child Tax Credit. Contact the cash easy helpline on 08457 289 289.

If you rent your TV, include this under ‘TV licence and rental’ on the household budget. If your TV was purchased on credit, don’t include these payments in the budget – these will be included with your secondary debts later on.

Travelling expenses. If you are running a car that is also used for your business, put the proportion of the cost not allowed against business expenses into this section. If you have a second vehicle not used for business, you should include the full cost of running it in this section. In any event, always remember to include road tax, insurance, MOT, servicing and repairs.

Hire purchase. If you need a car for mobility reasons and have bought the car using a hire purchase type agreement, you will need to include the payments in your normal ‘outgoings’ section of your household budget or you may risk losing the car.

Clothing is an essential item and as a rough guide you should include at least £13 to £23 per month in your budget for each person in the household. Only include non-dependants if you pay for their clothing.

Pension contributions. Include any amount you are paying to a private pension i.e. that is not deducted from a salary.

Maintenance. Include voluntary payments and any payments ordered by the court or Child Support Agency.

Prescriptions. If you cannot claim free prescriptions and regularly need them, you may be able to reduce the cost by buying a prepayment certificate. You should allow for the costs of prescriptions in your budget.

Other. Include any other necessary expenditure and be prepared to explain what these entries relate to.

There may be other items of expenditure not included on our budget sheet that you consider essential for your household. Include them if you wish but be prepared to defend them if challenged by a creditor or the courts.

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