New rules on credit card debt: what do they mean for me?
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Knowing where your money goes is vital to preventing problem debt, find out how much you know in our blog.
We bet you think the answer to the question in the title of this blog is yes! But, do you really? Say we were to ask you how much you spend each month on lunches – a sandwich, crisps and a bottle of pop, or if you’re good, a bottle of water, for example – per month, would you know? If you don’t, you could be leaking money from your budget that could be better spent elsewhere.
At Debt Advisory Centre we help people sort their finances. To do this we need to ask people a series of questions about how much they spend on things. Often people either don’t know, or they make a wild guess. As you can imagine, if you’re not really sure what you’re spending on things every month, it’s also going to be very tricky to keep a track of your money, potentially leaving you vulnerable to falling into debt problems.
So a little quiz, just to see how much you know about what an average family in the UK spends (don’t forget these averages are based on families from all income brackets). We’ll make it easy by giving you some answers to choose from:
1. How much do you think the average weekly UK household spends on food and non-alcoholic drinks?
A. £65.50 B. £102.50 C. £58.80
2. What do you think the average UK household spends on clothes and shoes, per week?
A. £53.00 B. £22.60 C. £70.00
3. What does the average UK household spend on alcoholic drinks and tobacco, per week?
A. £12.00 B. £50.49 C. £35.20
4. How much money gets spent on transport per week, by UK households?
A. £100.70 B. £70.40 C. £43.20
5. And finally, what’s the average total expenditure, per person, in UK households per week?
A. £219.40 B. £306.70 C. £250.00
Scroll to the bottom of the blog for the answers and let’s see how well you’ve done.
If you got all five questions right – well done! You’re pretty savvy when it comes to what things cost and how much people spend, so we’re sure you’ll have a good grasp on your own spending habits too. If you got most of the five questions wrong, you’re way off the mark, which may indicate your own finances could be heading for trouble too.
So, now think about the same questions, but for you and your family. Once you’ve guessed at what you spend, work it out and see how near to the mark you were. If you were right, or at least within a couple of pounds, great! You know what you spend, which makes budgeting all the easier. If you were way off, I’m sure you’re sitting wide-mouthed, wondering how that can be and, more importantly, what you can do about it.
The answer is fairly simple – you need to learn how to budget so you know exactly how much you are spending on things. If you do this, hopefully, you’ll not be storing up financial problems for later.
There are lots of places where you can access budget planning tools, like Shelter, MoneySavingExpert and Money Dashboard and any one of these would be a great start. You’ll need to gather together your documents in advance, so get:
- three months’ worth of bank statements
- your wage slips or benefits information
- gas, electricity and water bills
- bills for other outgoings such as mobile phones, sky subscriptions and so on
- credit card bills
- any recent receipts for payments by both debit card and cash – you may want to start keeping a little notebook that you can details everything you but by cash, so you don’t forget
Now you’re ready to go and budget to your heart’s content – enjoy!
Come back tomorrow to see how you can regain control of your spending with a spending diary.
If you’re already having problems with repaying debt and feel that you need some help to get it under control, why not chat with one of our advisors. They’re trained to give you the best advice for your situation and can talk you through all the different solutions that may be suitable for you. Simply choose one of the ‘contact us’ options from the left of the screen and say hello!
*taken from Table A9 Household expenditure by age of household reference person, 2013, ONS, Family Spending 2013 @ Crown Copyright 2014
by Shelley BowersBack to blog home