Look after the pennies and the pounds will look after themselves

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To celebrate the 20 year anniversary of the pound coin, Payplan, one of the UK’s leading providers of FREE debt advice and management, is offering people some savings tips to families struggling to meet their debt repayments. The last 20 years have seen dramatic changes in consumer borrowing and attitudes towards debt. In 1983 unsecured borrowing nationally stood at £18.9 billion, today it stands at £158 billion.

Payplan carries out a full assessment of people’s financial situation before reaching an affordable flexible repayment solution agreeable to creditors that will help towards managing their debts. Payplan’s service has no hidden charges or management fees so every penny goes towards paying off consumers’ debts as quickly as possible and no need to spend a penny!

Millions of pounds in Social Security benefits go unclaimed every year. Payplan estimates that more than 30% of its new customers do not claim all of the benefits available to them. The benefits that most often go unclaimed are Working Tax Credit and Child Tax Credit. (The following savings tips have been chosen solution by Payplan’s own individual case officers and are based on those most frequently given to people coming to them for a debt management solution).

Child Tax Credit: These are available to anyone (single person or couple) looking after children and whose income is less than about £58,000 per year. There are a number of factors that are taken into consideration such as the gross household income, number of children and childcare costs. For example, a family with a joint income of £19000 a year with two children could expect to receive around £166 every four weeks.

Working Tax Credit: These credits are available to anyone over 16 years of age who is in paid employment for 16 hours or more a week and who is either responsible for at least one child or who is disabled. Alternatively anyone aged over 25 who works for more than 30 hours a week can claim the credit.

Tax Code: People need to check with their local tax office that they have the right tax code and if they can claim tax relief on work-related expenses. Peter, a Payplan client from Solihull, found that his tax code was wrong because of the way in which his company car was treated. Once his code was adjusted he found he was £45 better off a month and, in addition, received a sizeable rebate.

Monthly budgeting: Payplan’s experience shows that people very often don’t know how much money they need to meet their living costs each month. When making a list of everything they spend, it is important to make sure that they consider ongoing expenses such as car maintenance and road tax that are often paid in lump sums as these can be budgeted for on a monthly basis. It is also important to make sure that they put money aside for items such as clothes, hairdressing, prescriptions and other health related costs, as again this will prevent them from having to pay out a large sum from one wage cheque.

Utilities: Often savings of £100 or more can be made on gas and electricity costs. Car insurance is another area where shopping around can pay off. Savings of £200 a year are often possible - one of Payplan’s clients saved £700 by shopping around. Savings can also be made in areas such as household insurance.

John Fairhurst, Managing Director, Payplan said,

"At Payplan, our clients often underestimate how the small amounts of savings can add up quite significantly with the help of some disciplined budgeting. We have found that once our clients have gone through a financial assessment with our individual case officers, they have made substantial savings and can afford to pay off their debts quicker. 80% of people who approach us for help find they are able to free up extra income."

The initial financial assessment takes into account their regular income, outgoings and expenditure from their mortgage, council tax, mobile telephone to housekeeping, childcare maintenance and smoking expenses. For an individual overview of their financial situation, consumers can access the Debt Calculator at www.payplan.com or phone 0800 917 7823.