Be honest with debtors on your full expenditure
I’m In debt, and the company I owe money to has said they will send me something called an income and expenditure form. What is it, and what exactly should I include in it? In short, an income and expenditure (I&E) form is used to help creditors understand your financial position and show them how much you can afford to pay towards the amount owed. as to what should be included, it’s like filling in a budget, so you’ll need to outline any income you receive, as well as expenses and debts you may have. First up would be your income. It’s important to include all types of income you are receiving. this could include wages, benefits, pensions, or any other money you receive on a regular basis, such as rent. then we have your expenses. these are usually broken down into priority bills and other expenses. some expenses will be more of a priority than others. Priority bills are your most important expenses and need to be accounted for in an I&E form. Payments such as council tax, mortgages and rent, energy bills, court fines and child maintenance payments are counted as priority payments. other spending would be expenses such as car insurance, public transport, pension payments or internet and broadband. these expenses are still important, but not necessarily to the same degree as your priority payments and bills. Your day-to-day living costs also need to be included. Establish your typical monthly spend as best you can by looking back on recent bank statements or receipts. Living costs are usually outgoings such as food costs, sports and hobbies, the dentist, school activities, and petrol costs. If your creditor thinks your living costs are too high, they might ask you for more information. these may include priority debts like council tax, energy, or rent, as well as other debts such as credit card loans, overdrafts, or fees for cancelled contracts, like gym memberships or mobile contracts. It’s important to note that the above lists of priority bills and expenses are not exhaustive. If you’re unsure about the category under which certain payments fall, always double-check before submitting the form. some I&E forms ask what you think you can afford to pay towards your debt. the amount you can offer the creditor is based on what’s left after covering your priority bills, other expenses, and living costs. It’s important to be accurate to show your true financial situation. take your time reviewing the figures you’ve listed. It’s crucial to determine what you can realistically afford. Even if you’re concerned that the amount you’re offering is too small, it’s still important to make the offer. after considering your income and expenditure, you just need to make sure your offer is affordable. the advisors at moneyadvice.scot can help you fill out your I&E form if you need some support. Contact their team at 0808 196 2316 or visit www.moneyadvice.scot