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Benefit cap: what does it all mean?

calendar07 November 2016

Gemma Pask's avatar Gemma Pask

Benefit cap: what does it all mean?

You may have received a letter recently telling you that today (Monday 7 November) the benefit cap will be lowering. Letter or no letter, it can feel like a lot to get your head around, especially when there are figures and jargon flying all over the place. And, of course, the prospect of having a chunk less money can naturally be concerning, especially for those already getting by on a low income. So we've tried our best to break it down for you here, helping you to understand the changes and whether your household will in fact be affected at all. We hope it will put your mind at rest, but remember, if you're worried about getting into debt, you can always give us a call on 0800 328 0006.

What is the benefit cap?
The benefit cap is a limit set by the government on how much money working age people (aged 16 to 64) can claim in benefits per year. It was first introduced by the coalition government in 2013 (May 2016 in Northern Ireland) and was set at £26,000 for most dual and single parent households and £18,200 for most single people living without children. In July last year, the government announced it would be making £21bn worth of welfare cuts, which would include lowering the benefit cap.

What will be changed?
From Monday 7 November, the maximum amount of money you're allowed to claim each year will go down, and will depend on who you live with, where in the country you live and which benefits you are in receipt of. The cap will be jointly administered by the Department for Work and Pensions (DWP) and Local Authorities (LAs). Initially, it will be deducted from Housing Benefit payments and will eventually become part of the Universal Credit system. There's a chance you might not see any change immediately as the cap is set to be rolled out across several Local Authorities at a time from now up until the end of January 2017.

  • If you're a couple with or without children living with you, and you live outside of London, you'll now be allowed to claim £20,000 per year.
  • If you're a single parent (with children who live with you), and you live outside of London, you'll also now be allowed to claim £20,000 per year.
  • If you're a single person, you don't have any children (or they don't live with you), and you live outside of London, you'll now be allowed to claim £13,400 per year.
  • If you're a couple with or without children living with you, and you live in London, you'll now be allowed to claim £23,000 per year.
  • If you're a single parent (with children who live with you), and you live in London, you'll also now be allowed to claim £23,000 per year.
  • If you're a single person, you don't have any children (or they don't live with you), and you live in London, you'll now be allowed to claim £15,410 per year.

Who is included?
It's estimated that around 88,000 out-of-work households will be affected by the new cap. Most people between the age of 16 and 64 who currently claim benefits will see a change, but there are lots of exceptions.

  • You won’t be affected by the cap if you or your partner work, are eligible for Working Tax Credit or get Universal Credit (with a household income of more then £430 a month after tax and National Insurance).
  • If you're old enough to apply for Pension Credit (whether you actually have applied for it or not), you'll also be exempt.
  • Not all benefits are included in the cap - click here to see the full list of inclusions and exclusions.
  • For the most part, however, if you are going to see changes to the maximum amount of money you can claim, you will have been notified by letter, so it's worth having a sift through that pile of post.

Where can I find out more?
There's plenty more information on the government website and from the Money Advice Service. If you're still unsure whether or not your household in particular will be affected by the changes, try the benefit cap calculator which should give you a more individualised explanation.

Cold callers: let’s freeze them out

calendar03 November 2016

Joseph Allison's avatar Joseph Allison

Cold callers: let’s freeze them out

It has gradually become a regular part of my life that every now and then, someone will call me and tell me I’ve been in a car crash…

I haven’t had a car crash recently, or rather I hope I haven’t because a car crash that you can’t remember seems a little more worrying than one you can remember! Sometimes they phone my home and tell me there’s something wrong with my Windows PC – again, the Windows PC I don’t have (other computers are available). Of course, I know they’re all scam calls from people hoping to steal my money and my details.

It’s easy to shrug it off and laugh about it, but in fact a recent study found that more than half of British adults regularly receive scam calls more than once a month. Up to a third receive a call at least once a week. Scammers are getting more sophisticated and are using a wide range of tactics both on the phone, by post, face to face and online, with up to three percent of British people saying they’ve lost money to them. For various reasons, they benefit from targeting vulnerable people, the elderly and people who might be in debt already. They often tempt people in with the false promise of free money or compensation, only for their victims to find that their money is gone.

It’s a serious problem.

You should be careful not to buckle under pressure. Many scammers use intimidation tactics or pressure you with a once in a lifetime offer; a ‘now or never’ deal. The main thing to be aware of is being asked to disclose personal or financial details. Never give out your bank pin codes, passwords or online bank codes. You should only disclose other personal details like names and addresses if you are certain who is on the end of the phone. If you think the call may be legitimate and you’re interested, or if you’re already a customer of the supposed company for example, you can always ask to hang up and call the company back directly.

If you think you’ve been a victim of fraud either on the phone, online, by post or in person, the first thing you need to do is report the crime. You can do this by going to Action Fraud, the national hub for reporting fraud and cyber crime.

Keep getting calls from the same number? On most phones you can block certain numbers from contacting you or you can simply screen them. Legitimate callers are slightly more likely to leave a message (though, of course, you should still be vigilant). Which? has launched a campaign to get the government to crack down on cold calling and nuisance calls. To sign the petition, view the list of the top ten most reported numbers and find out more about identifying a scam call and staying safe, click here.

Make your Bonfire Night go with a fizz… one that doesn’t scorch your wallet

calendar02 November 2016

Joseph Allison's avatar Joseph Allison

Make your Bonfire Night go with a fizz… one that doesn’t scorch your wallet

Have you looked at the cost of fireworks in your local supermarket and visualised your budget going up in flames? You’re not alone.

Attending an organised fireworks display can set you back even more, especially if you’re going as a family. There’s the hot food for sale, rides and light-up toys that never seem quite as interesting just a couple of days later.

But there are ways of marking the occasion with friends and family without seeing your spending rocket. Here’s how!

1. Check your local paper to see if there are any local free events happening. Some sports clubs or churches put them on so it’s definitely work a check.

2. One other way is to pool resources. Rather than putting on a display just your family can see, organise a get together with your friends and wider family where everyone puts in a little bit towards the price of the fireworks, and brings food and drinks to share.

3. Baked potatoes wrapped in tin foil are a budget but warming snack on a cold autumn night. ASDA are selling a 2.5kg bag of baking potatoes (a bag of about seven) for just £1.70*. Any left over can be microwaved for a cheap lunch in the days after.

4. Wanting to mark the occasion but spend pennies not pounds? Dress up warm, find a local hill, take some warm snacks and a packet of sparklers and do some family firework spotting.

5. Need a kids’ activity? There are some great colouring in pages, free to download here.

6. Or make yourself some chocolate sparklers!

Whatever you do, do it safely.

*Price correct at time of publication

Eight ways to save energy

calendar01 November 2016

Marianne Clough's avatar Marianne Clough

Eight ways to save energy

If you’ve been trying to cut down your energy costs, you may feel like you’ve tried everything. You’ve switched (if you are able); you’ve popped another jumper on; you’ve turned down your thermostat. Now what? But don’t despair – here are eight more easy tips to try.

1. Move furniture away from radiators and clothes. They absorb so much heat which needs to circulate in your home.

2. Cut the time your tumble drier is draining energy by putting a dry towel in with the load to absorb moisture faster.

3. Draught-proof your doors and windows. There are some nifty tips on how to do this here.

3. Cook ahead using the gas or electric for several meals, which you can then zap in the microwave in the days to come. Better still, use a slow cooker, which uses a third of the cost of a cooker according to a report by The Telegraph.

4. After the kettle has boiled and you’ve made a cuppa, put more water in it while it’s still hot so it boils faster next time. Don’t overfill it – just boil what you need.

5. Stop charging phones overnight. Energy saving timer plugs are brilliant or charge the phone in your car or even just plug it in at work. Also be sure to switch off or unplug the charger once you’re finished – it’s easy to grab your phone and walk away, but remember the longer it’s left on, the more energy is being guzzled.

6. The previous point applies to other appliances too. Always turn them completely off, not just on standby – you’ll save around £30 a year!

7. Swapping to LED lightbulbs might not be as expensive as you think. Did you know just £7.99 will buy you a five pack?

8. Finally, you could be eligible for an energy grant to improve your efficiency. Click here to find out more.

Christmas on a budget: how to prepare

calendar26 October 2016

Joseph Allison's avatar Joseph Allison

Christmas on a budget: how to prepare

Christmas is well on the way, and while there’s still no need to panic, we all know that affording the celebrations can become a worry, especially when you’re living on a budget. However, if you’re creative and explore your options you could definitely save some money.

Christmas is hardly advertised as a simple time where you just spend time with the people you love and give a few presents. There are all the additional trimmings that put a strain on your budget – the food, the drink, the tree, the decorations, the wrapping paper, the Christmas cards. One simple way to be more frugal is by taking stock of what parts of Christmas you could feasibly do without, and reduce the amount you spend on them or indeed cut them out entirely.

I don’t know about you, but I always skip past the Christmas cards to get to the presents. Sometimes to save money I cut out cards entirely, but you might just need to decide who’d really appreciate a card and whose will probably end up in the recycling bin. Your friends might appreciate it if you get creative and make your own cards. Why not take a family picture and write a message on the back? This is personal and simple, plus if it’s a digital photo it’s easy to send by email, cutting down postage costs. There are also lots of free eCards online for Christmas. You could print letters and even decorate them yourself. Some well-chosen words might be more meaningful than something pre-written in a card anyway. You might consider sending postcards as they may cost less to post than regular cards or delivering yourself if it’s not too far.

Gifts are a big part of Christmas, especially when you’re young. Gifts are also one of the most stressful and expensive parts of Christmas, especially when you’re older! One thing you might want to think about is agreeing with the adults in your life that you’re only going to buy presents for the children. If you really want everyone to get a present, you could agree a limit of £5 per person. Money Saving Expert has a list of 50 presents that cost a fiver or less, in case you’re in need of inspiration. Alternatively, why not try making your own presents or giving your natural skills and time as a gift? For example, if you know someone with children, the gift of a night off while you babysit might be really appreciated.

You never know, your friends, family and colleagues might be struggling to pay for presents as well, so why not suggest a secret Santa? That way, everyone buys just one present each. As well as being easier on your budget, you could make their Christmases easier too by pooling resources. You could do a ‘bring and share’ dinner at your house on Christmas Day where everyone brings a dish. You could swap decorations you no longer need between friends. You never know what you might bag in the process!

Your energy bills are something else to bear in mind when it comes to decorations. Leaving your Christmas lights on all day could add up to a hefty sum. Either use cheap, low energy, LED ones or go uber low tech with the classic tinsel and baubles. There are plenty of ideas online for decorations you can make too. Keep energy bills in mind when you’re cooking dinner too. Things like boiling veg in one big pot, using fewer appliances and keeping the lid on a saucepan will cut down the energy you’re using and therefore the cost.

This all being said, just remember that no matter how much you spend this Christmas, the most valuable thing is spending time with the people you love and celebrating God’s unending love – after all, God really isn’t bothered how tall your Christmas tree is or how many presents you buy.

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