Money Box Live: Can you Beat your Bills?

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BBC Sounds. Music, radio, podcasts. Hello. We are a third of the way through April. So how's your bank balance looking? Have you carefully budgeted for each week? Or will there be too much month left at the end of the money? Certainly a lot of people will find themselves in the red before payday. Almost 15 million people are finding it difficult to cope financially or they're not coping at all.

That's what data released today by the Financial Conduct Authority shows. More than 7 million people were struggling to pay bills and make repayments on borrowing at the start of the year. The good news is that's actually down. It's down from almost 11 million. last year.

But it's still far higher than before those cost of living pressures really started to bite. But now price rises are slowing and energy bills have come down. So today's Moneybox Live podcast is about how to seize the moment to finally beat your bills back down. and build a brilliant budget. Before we meet today's experts in sorting our lives and our finances out, let's hear from Hlandudno. Our reporter Neil Morrow went there to speak to people about what bills are bothering them.

My gas, my electric, my rent, council tax, road tax for cars. It's a multitude of everything really. It's mainly utilities and food. things like that, so I tend to shop around different supermarkets for different bargains and things like that. A battered sausage in the chip shop used to be 90p, it's too paid out you know, because of things like cooking and obviously they've got to put their, it's not their fault.

Does that mean you can't eat out like that hardly at all? Well, it's a luxury. That's a family meal, surely. All it used to be a family meal. Saving is not that much as it used to be earlier. Everything goes in the basic grocery and stuff that you have to buy for home. It's just cutting back, you know, just... It's getting rid of the treats really. You need to treat yourself every so often but unfortunately bills take priority.

Well, I'm sure today's panel are sympathising with that, especially the battered sausage. I am joined by consumer expert Martin James and Jay Lowe, Head of Money Advice at Citizens Advice Staffordshire North and Stoke-on-Trent. Good afternoon.

Good afternoon. Thanks very much for joining us. Martin, when I said you'd be on with J-Lo, were you hoping for Jennifer Lopez? Well, I was absolutely thrilled, but I'm even more thrilled knowing that it's J-Lo and the magnificent advice that will be coming.

So I'm really, really happy. Glad to have you both with us. Jay, there was a real mix of things there from Llandudno. What are you hearing at Citizens Advice when it comes to where people are finding things tough? I think things are still tough with energy costs. I know the energy prices are coming down, but we see a lot of clients who've built up debt over the last couple of years. So their payments are having to include an amount for the debt. So the actual payments may not be coming down.

Similarly I believe food prices are dropping. I'm not sure that that's actually made its way through to all of the supermarkets as yet. So people still are struggling. We are still seeing a lot of people with deficit budgets. Deficit budgets where there's just not actually enough money to budget with. We'll talk about that in a moment. But the FCA research out today shows that last year, 2.7 million adults sought help from lenders, from debt advisors or from financial support.

charities like yours because they were struggling. Jay, do you only see people when they're in a crisis or do they come to you when they're starting to fall behind? Mostly it's when they're in a crisis. We do see sometimes some people that are anticipating changes, so they're going to retire or they've lost their job and they're worried about how they're going to manage bill payments.

And we will help on at whatever level the client needs. So obviously, if it's crisis, then it's crisis management in terms of debts, then moving on to longer term debt solutions, possibly such as debt relief orders. But alongside that, still looking at working with clients to look at budgeting and managing budgets so hopefully they don't fall behind again. But if people also come to us because they're anticipating a change.

Ideally, obviously, the sooner the better to seek help because there is a lot of work that can be done to prevent it ever getting to a crisis stage.

Martin, the key thing is to know what's going in and coming out of your account. Lots of people just don't have a budget actually worked out. Yes, this is really something that's very common. And I should say as well, you know, people listening to the show who are worrying about their finances or find all of this a little overwhelming. We will do our level best to kind of keep this positive. There are lots of solutions out there as well.

kind of the horrible reality of it but yet making a basic budget is absolutely essential now I generally say to people because I'm also a bit rubbish I'm happy to admit that's live on air I have to know my own limitations and the things that scare people about starting out and doing all of these things. So just doing really, really basic things, like just setting yourself a maximum of 15 minutes to work out your money in and your money out, just the basics. And also...

Having the radio or the TV on in the background, there's nothing worse than looking at your finances when you're sat in silence. So do it in little chunks and give yourself a reward as well. In fact, there's a whole back catalogue of Moneybox episodes.

you could have on in the background if you really want to go to town. Now, as you would expect, a lot of Moneybox listeners are quite good at budgeting. We've had this message from Nikki. Hi, Moneybox. I use a budget sheet, which really helps to record away. outgoings and incomings just like my mum used to do with her paper copy. It helps me to have a really good idea of what I've got and what I haven't got and then I put any extra money up into savings.

Martin, this must be music to your ears. For anyone who's not that organised, how do you start? drawing up a budget. Are there free tools, maybe online, maybe apps that you can use? Yeah, there certainly are. There are loads and loads and loads of them. But again, you know, I'm here to be the voice for all the people who are a bit useless when it comes to these things.

downloading apps is you have to learn how to use them and that's one more extra step that can mean prevarication and not dealing with it so actually look for things like you know basic spreadsheets apps if you want to kind of just have a couple of columns

with the basic information in there. Or, actually, save yourself a bit of time. If you go onto the free debt charity website, StepChange, you will find on there a really quite detailed budget planner. And that's kind of what you would use if you were seeking help from any...

regulated organisation. So it's definitely worthwhile having a look at maybe that one if you don't know how to get started or it all seems a little bit overwhelming. But know yourself. That's the most important thing. Don't commit to anything that realistically you're not going to do. And don't set yourself unrealistic targets about how often you update things or check them because as soon as you fail, we have a tendency to give up.

It's good advice for the gym as well as for your finances, isn't it? I can't help you there. Right, this is all very practical. Shall we make it a bit more romantic? We've had this from Amy Knight, who admittedly is a finance expert. Here's her tip. My partner and I will take our laptop down to our favourite cafe. Once a month we'll treat ourselves to a piece of cake and we'll go through our income and expenditure and we'll talk about what our money goals are.

in the short term in the long term and even though budgeting has a reputation for being boring it doesn't have to be i really look forward to our budgeting date

There you go. Making budgeting romantic. Maybe it depends on how good the cake is. Maybe that's the solution. Right. So you have a budget. You've drawn it up. You'd probably now like to make your outgoings a little bit smaller. Martin, some bills. They're just fixed costs, aren't they? Your mortgage, your council tax, for example. And there's not much you can do there. With the ones where you can't vote with your feet, like your water bill, for example, or with the dreaded council tax.

there's a lot less wriggle room, but there are still things you can do. So, for example, I mean, it's startlingly obvious when you know it, but I didn't know this until a few years ago. Because most of us pay our council tax in 10-month chunks, you can actually speak to most councils.

and ask if you can pay over 12 which will reduce that bill so you can't negotiate down a cheaper deal you can see if you're in the right band for example but that's one way to cut a little bit of the cost off that and with things like water

as well you know you might find if you're single or you're in a couple you live in a flat you're not really using a huge amount of water then going on to a water meter might be a better option for you but of course if you have a family there's three kids running around and you've got the washing machine going all the time, I'd think again and try not to. Okay. And what about if you're coming out of, say, a fixed mortgage and energy deal?

Can people shop around for better prices on those at the moment? Because last year there were high interest rates, high energy costs. It made it really difficult to find a better deal. Oh, gosh, absolutely. Now, mortgages, this is a bit of a carnage, really. You do need to speak to a good mortgage broker because, as we've heard, some of the best deals are going onto the market and flying off almost immediately. I would say Foresight is the best option there.

planning in in advance speak to a broker speak to your mortgage company just so you know what options might be available to you in the run-up to that period But also as well, I mean, with energy, we find one bit of fabulous good news. The new energy price cap has kicked in now. Energy bills have gone down. It looks like they're going to go down a little bit more, not as much as we were promised, but a little bit more.

in July which effectively means we're going to get six months of cheaper energy just at the point where we might not quite yet though might be just about ready to turn off the heating But again, have a look at the deals that are out there and think about these three factors.

If you're unhappy, what's the exit fee? What are they going to charge you to leave the deal early? If you're cautious, maybe look at fixing with your existing supplier at the moment. But if you're willing to take a bit more of a risk, a standard variable... could also work as well but I would hold fire for a few weeks. I think we're going to see some better deals coming onto the market. Jay, you must see a lot of people struggling with their energy bills.

Yes, I was actually just going to add as well that spending diaries are often a really, really good way for people to begin to pull a budget together. Because I think a lot of us, particularly, you know, if you use cash, you don't really... don't really don't know where it goes so we've had some really really good

outcomes with clients so for instance one of them was actually able once she'd done her spending diary to create a budget see where she could save and actually managed to save up for a secondhand sofa rather than having to try and get a loan from somewhere for it so that's a really good sort of baby step as it were to begin to analyze and work out where you spend and then just going back to some of the bills

Water companies as well can sometimes agree to 12 monthly payments. So again, that's something that, you know, again, exactly as Martin said, it doesn't reduce it, but it spreads it over. So they're lower payments. But also it's definitely worth checking with local councils, local authorities and water suppliers. There is help available to people that are struggling.

particularly financially or if they have any other vulnerabilities in the household, there is help available. So I think there's a dual thing of working out. income and expenditure and trying to reduce expenditure where possible but also just as importantly

checking that people are getting everything they're entitled to, maximising their income, as we call it, seeing what other help is still available out there. And there is still quite a lot of help. So in terms of energy costs, there are still... A lot of benevolent energy sort of grant funders that are still offering fuel vouchers. Certainly most local citizens advice bureaus have access to still quite a lot of help with fuel costs. So it's still worth...

making the contact and asking for that help. That's very good advice. Thank you. Now for some people, neurodivergence can make it slightly trickier to get a grip. on finances. Here's one tip we've had on how not to make your shopping bills any bigger. My name's Sarah. I am autistic and I also have ADHD and I have always struggled with money.

i think one of my biggest tips would be sort of um if the thing is in the basket step away and you may well find in a few hours time you don't want that thing anymore because there's a big compulsion to this kind of thing and there's like a I need it now take a deep breath think give yourself a bit of time and then go back to it if it's if it's necessary I think step away from the basket is good advice for everyone. So Sarah, thank you very much for that.

What if you're struggling with debt? Now that can make budgeting even harder and it makes it even more important. Let's hear from Glenn, who got into debt as a teenager. I got a job. I needed a car to get me to and from work. and college so I took out my first personal loan when I was like 18 years old and eventually I started getting offers from

credit card companies. And of course, they're very, very tempting, especially when you're a youngster who hasn't really learned what it is to be financially responsible yet. So I took those out and automatically thought, hang on a minute, this is free money. really spiraled from there so i think by the end of it i was something to the tune of about 25 000 in debt and i was only in maybe my mid to late 20s um i got to my early 30s

And we very sadly lost my father. But what position that left us in is my mum, who then had quite a lot of money. And I went cap in hand to mum. She was good enough. to be able to lend me the money. I felt like I had a lot more responsibility to have to pay mum back. I eventually cleared all of my debt.

by the time I was 42. Glenn, thank you very much for sharing that with us. And Glenn actually told us he's managing to save a bit of money now. He's got a credit card that he pays off at the end of every month. Jay, if people are in a spiral like Glenn was and they can't get help from family, what can they do? I think they need to seek help. There's a lot of online help and information that people can access.

But there are, again, lots of agencies out there, Citizens Advice, obviously, but there are lots of other agencies. Step Change is another one where they have helplines and people can ring and they can get help. It'll always start with a budget and, you know, a proper assessment of what's coming in, what's coming out, where there are savings that could be made on either side.

And really based on that, then what kind of long-term solution may be suitable for each person based on their individual circumstances? That could range from anything to... grant applications to try and see if some of those debts could be covered or payment plans.

or debt relief orders, or bankruptcy. So there's quite a range, but it's always tailored to each individual situation. That research from the FCA said two in five adults who'd missed payments said that they'd avoided talking to their lenders. about their finances. Why is it so hard to face up to this and have a conversation with your lender?

I think people are generally reluctant to talk about money still, particularly where there's any kind of hardship or problems. And I think it's fair sometimes that there's a possible myth out there that creditors are unhelpful or won't listen. There is a lot of obligation now from the FCA, actually, on creditors to help people who are financially distressed or vulnerable in other ways through various things. payment holidays or referrals out to sort of advice help.

we've had a message from somebody who hasn't given their name who says I've always been terrible with budgeting the thing that actually ended up working for me was having an account with no overdraft that I pay into weekly with my money for the week thank you very much for that tip Let's hear from Josh now. He also got into debt, but he couldn't get help from family. Mum was very different. You know, I was an addict, so I needed to fund my habit.

um and the options i went down were obviously sadly uh getting out loads of credit cards payday loans It's about nine and a half months ago now. I got myself into a, you know, a supported accommodation, a company that gives you obviously help. And by that point, I just kind of sat down, the penny dropped to my mind kind of ticking going, I need to get this sorted. So when I called Money Wellness, they went through all of the options for me. And it was a debt relief order.

and that means all of that debt will be gone it's it's not one of these things it's like oh yeah you know i'll get debt relief order i could start all again and take the mick out of you know credit there is obviously you know conditions that are in place where you're downgraded on your credit for six years until it changes. But the biggest bonus is that no longer am I going to be getting any sort of letters that are going to be demanding me for any money.

Jay, you mentioned debt relief orders and you work with these a lot, don't you? Just explain what they are and who they're suitable for. So a debt relief order was brought in to try and address... people with a sort of maybe a lower level of debt, but more importantly with no assets, no available income. And it is effectively a legal form of writing off your debt.

The great news with the budget that came out was that the fee of £90 it used to apply is no longer there. So it's a free solution now for people. It has to be done through an approved intermediary who is a debt advisor. able to submit DROs on behalf of the insolvency service. And it can effectively write off debts. I mean, as Josh said, yes, there are certain caveats. It does have a certain...

effect on your credit rating. And it doesn't necessarily include all debts, but most of the debts will go and it effectively gives somebody a new start. And you've mentioned a few of the organisations earlier that you might be able to approach for advice on this. And I know Josh mentioned Money Wellness. That's a free debt advice organisation funded by the Money and Pensions Service. Martin, not...

all debt is bad debt when you're budgeting, is it? Often it's an important way to smooth over a big cost that your budget can't handle, can't absorb. Yeah, I think lending and credit has got a bit of a bad press over the years, largely because of... the more established lenders and their behaviour and also because people of my generation in particular

did kind of get into terrible messes. I've been very honest about my own battle with debt and how long it took me to pay it all off. But there is light at the end of the tunnel. There are things that you can do. But when it comes to borrowing, there will be times when you... You know, you might need that new sofa or you might need to just get through a particular period in your life that's a little bit difficult, a short term.

problem the important thing is if something goes wrong you are able to take the matter further and that's why we have regulated financial products and that's why we have the financial ombudsman that you can go to now of course the downside to all of this is some of the new

financial products which we've often talked about on the show like the bulk of the buy now pay later industry is not currently regulated and that's something that i have a great deal of concern about because it's disproportionately young people who find themselves you know

fault of their own suddenly saddled with considerable debts in the space of a few months and that does affect their credit file. It's interesting though that buy now pay later can work really well to bring some people's kind of credit card costs down as a free alternative but yes.

Definitely something to be careful of when budgeting. Lots of you getting in touch with your thoughts, your tips. Martin has been in touch on X. He says his top tip is taking cash out and using it. He says, took the kids to Cardiff. for a few days and spent £170 but no dreaded tap tap tap. The best thing was once it was gone that was it. It was a great way to budget. Jay that's a bit like your spending diary isn't it? It's just having something where you actually have to notice what it is.

is your spending. Yes and the other advantage I think with spending diaries as well as budgeting is that whole idea of you know, sorting out what is it that I absolutely have to pay all our sort of normal everyday bills, possibly some other payments, you know, commitments that you have. And then... Much in the same way, you then have a sum left over that you can then think about where do we want to spend this? Do we want to go out or do we not? But it's important that that is left after.

the sort of priority commitments are paid. Jonathan from County Amar has emailed. He says, my top two tips to help budget more effectively. First, use click and collect grocery shopping as it helps avoid impulse buys. And secondly, set up a standing order to transfer surplus income from your...

pay packet into a savings account for which you don't have a card and then try to get to the next payday without dipping into it. I think that our next caller might have quite a lot to say about that. Let's finish with some budgeting inspiration. from Matilda. Matilda, good afternoon. Hi, Felicity. Thank you so much for joining us. Now, you are essentially the person we all wish we'd been. You managed to save £50,000 by the age of 28. How?

I think like so many various ways, but I think with budgeting, it's getting the foundations right. One of the things that I did when I graduated from university is gave myself an allowance. So as my salary kind of grew, I tried to keep the allowance the same, but obviously allowing for inflation and really understanding and knowing my spending habits and knowing what works for me. I've recently moved into a new flat, actually.

And I stopped meal planning and just found myself going to Tesco for little top up shops. And my food just went well over budget. So it's those small things that can easily add up. So it's a very controlled kind of spending life that you have. You could be honest with us. Does it get a bit boring? I mean, do you spend a lot of your life searching for deals instead of occasionally just splashing out and having a treat? I think like honest truth, there's definitely trying to find that.

find balance between having fun right now for yourself and also saving for your future self. But I think a lot of things from discount codes, cashbacks, price comparison sites, it's almost come just natural in my life now because I've done it for so long. But there are definitely times where I can struggle. No one's perfect. Why do you think that this is such a focus for you? Because you're very different to me when I left uni.

I think growing up, money wasn't really spoken about in my family, but there was definitely habits that I learned from my parents. I remember the 2008 financial crash and my parents were being more careful and tight. with money and they would call it a rainy day fund which now I know is an emergency fund and I think I probably didn't realise back then but it's those little things that have taught me to be a bit more cautious with money.

Stay with us, Matilda. I want to hear what our experts make of you. Martin, I made all my best money mistakes when I first left home. And I've kind of looked back on that and thought, maybe I needed to make those mistakes in order to learn.

then Matilda's here ruining that illusion for me. I think Matilda's wonderful. I think it's really, really important to see, you know, positive things that people actually can do to save money, particularly if money's a bit tight, because, you know, basically...

you're thinking, well, I'll never be that person. But if you can see that you can... Matilda mentioned there, you know, spending a little bit more sensibly. There's ways that you can actually spend where you accrue vouchers, where you get discounts by using certain cards or apps. So there are things that you can...

do right now even if your budget is absolutely appalling where you can actually the money that you're spending that you have to spend on things like food you can actually make work for you a little bit better so if you're listening to this and you're like me um and i do sorry felicity you under my bus, but it doesn't come naturally to you, then have a look at some of these tips because actually you'll find that there are ways that you can make your existing money go further.

Matilda, what's your advice for anyone starting saving from scratch? I would always say just have a look at what you're spending and your habits right now and build a budget. Be really realistic with your goals. How much I've saved, that was never the goal at the start. It's kind of moved as I've gone on. been realistic.

And I think also have a look at your spending, haggle on bills where possible, you know, things like car insurance, phones, you know, do we need the latest iPhone? I've got a Ford Fiesta that I've had since I was 21, still going strong. But things like car insurance, I mean, that's just come up for renewal. But have a look at price comparison and cashback to see where you can get it down and negotiate where you can too.

Well, Matilda, thank you so much for joining us, telling us what you do. Really appreciate it. Anytime. Thank you. Jay, that's a great news story. And the data out from the FCA today does suggest things are starting to ease. There are fewer people in crisis. Are you seeing that?

Not yet. I think sometimes it takes a while to filter through. But I think what I really liked, in fact, and what came through with Matilda is also about communication. So despite the fact that money itself may not have been talked about, clearly her parents did. talk about rainy day funds and thinking around money. And I think if we could just get people to...

Discuss these things in families sometimes, even with children. Let them understand about setting limits and differentiating between need and want. That's a great step forward. These are very good step forwards. Thank you very much. Suze has tweeted, set up a direct debit the day your wages are credited and transfer to a savings account. Even if you need to dip into it, it will soon add up.

Well, no matter how carefully we budget here at the Moneybox Live podcast, we do always run out of time. Huge thanks to everybody who shared their stories and tips. And thank you, of course, to our panel. We've been hearing from the consumer expert Martin James and Jay Lowe from Citizens Advice. And just a quick mention, because Jay's been on our panel a few times, she's actually retiring in the summer after 27 years of helping people. Very, very best of luck with it, Jay.

Don't forget to catch Paul Lewis with our Saturday Moneybox programme just after the midday news. If there's a story you want Paul, me or the team to take a look at, then please do email. It's moneybox at bbc.co.uk. Please include a phone number if you can. In this podcast, the producer was Sarah Rogers, production coordinator Sandra Hardiel, studio manager Scott Henderson. Our editor is Jess Quayle. I'm Felicity Hanna and this was a BBC News money and work production for BBC Sounds.

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