Universal Credit is a monthly payment that takes some getting used to if you’re out of work or moved from the previous benefits system. Feeling out of control when it comes to money can be overwhelming, however, the only way to effectively manage your money is to draw up a household budget.
So, here are our top money saving tips and budgeting advice to help you manage your payments.
What is Universal Credit?
Universal Credit is a benefit payment provided by the government and is there to support you if you’re on a low income or out of work. It’s designed to help with living costs and combines six benefits including:
- Child Tax Benefit
- Housing Benefit
- Income Support
- Income-based Job Seekers Allowance (JSA)
- Income-related Employment and Support Allowance
- Working Tax Credits
Where to Start When Trying to Budget your Money?
If you’re worried about where to start when creating a budget, you need to remember that it’s just two lists. Your income and outgoings. You will need to create a monthly budget as you will receive your universal credit payment once a month.
Firstly, create a list of all your income including, Benefits, Wages and Other Income that you receive each month. Don’t worry if your monthly income changes from time to time as once you have a budget in place it will help you will be able to easily adjust it without having to start from scratch.
Outgoings include things like household bills, living costs, travel expenses, insurance and loan repayments, child costs and leisure or entertainment. A quick way to find all your monthly outgoings is to check your direct debits, standing orders and regular transactions to find out where your money tends to be spent.
If you find that your outgoings are higher than your income the next step is to look more closely at your spending and where you can cut back.
3. Utilising a Budgeting Tool
There are a few ways to keep track of your budget, Microsoft Excel provides budgeting templates in a spreadsheet format so all you need to do it input your income and outgoings and it works out your budget for you.
Additionally, if you’re not comfortable with using Excel there are countless budgeting tools and mobile apps that can make it easier for you to work out your expenses – but be sure to choose a tool where you can save and edit your budget if you need to make a change!
Top Money Saving Tips to Make the Most of Your Budget
Now you’ve drawn up a budget, sticking to it will be the hardest part. However, these top money saving tips and advice are to help you stay on track and find and save extra cash in places you might not have considered.
1. Government Money Saving Scheme for Universal Credit Claimants
The Government’s Help to Save scheme allows people on Universal Credit to get a bonus of 50p for every £1 saved over a four year period. With this scheme, you don’t have to pay money into your account each month but the most you can pay in is £50 a month.
You will receive your bonuses at the end of the second and fourth year directly into your bank account and are based on how much you safe. However, you can withdraw your money early but you may miss a bonus.
2. Budgeting Loans
You’re entitled to a one-off Universal Credit Budgeting Advance if you need some extra money to purchase an item you need such as a new fridge to replace a broken one, work-related expenses and repairs to your home.
Although this is classed as an interest-free loan, you will have to pay it back through your Universal Credit payments or as a direct debit if you’re in work. You won’t be able to take out another loan until you’ve completely paid it back.
However, in times of need, all you have to do is call up and speak to an advisor who can issue this for you. If you’re unsure, your work coach can guide you through this.
3. Look at Ways to Cut Costs
Savings are important to protect you from debt and emergencies. If you don’t have a lot of money coming in, one money saving tip is to start cutting back on costs.
There are many ways to go about this, including downgrading your technology, swapping memberships for one-off payments, buying second-hand goods, and switching your energy or broadband supplier.
4. Save Money Using Coupons, Vouchers, Discount Codes and Cashback Rewards
Whenever you’re making a purchase online, it’s worth spending a few minutes searching for a discount code, whether you can save 10% by signing up to the company’s newsletter or seeing if you can find the product for cheaper on discount websites like Groupon.
Cashback is another way to save money and create regular income when buying everyday things. It works by giving you a percentage of your total spend once your purchase is confirmed.
Suits Me account holders automatically gain access to exclusive cashback rewards on high street and online retailers. To learn more about our cashback rewards, visit our Exclusive Cashback Programme Page.
Saving Money and Budgeting for your Future
Now you know where you stand when it comes to managing your universal credit payments. If even things come along that you haven’t budgeted for, you can always adjust your budget and stay in control of your money.