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Direct Debit, Direct Debit. Hopefully we have attracted your attention. Paying by direct debit will invariably save you money. Typically you can expect to save at least 5% on your household bills. It will also save you a lot of bother writing cheques etc. The only downer is having to carefully manage your cash flow so you have sufficient funds in your account - more about that later.
Arguments - you love your flat mates dearly but lets face it, paying bills will almost always cause more strife than dividing up the cleaning duties. Everybody's budget is tight and you don't want to fall out over your account going over drawn, just because him in the next door room is skint. We see various options to helping you improve the situation.
- Appoint one poor sod to manage a kitty that you all contribute into. The plus side is that invariably your bills will get paid, meaning that your heating will work through out the winter. The down side is there are no guarantees of getting everybody to cough up, so the said poor sod ends up throwing a tantrum and leaving the flat. We do not recommend this approach unless you are in a very small flat (2 or 3 people whom know each other well). If you do end up going down this route then, as you probably did all the work in finding the flat, use that as an excuse to get out of becoming poor sod!
- Each flat mate takes responsibility for one or two bills - we recommend this where you are in a flat with good mates that you consider to be pretty reliable. The best bet is to give the biggest bills (gas, electricity etc) to those you consider least reliable - if they fail to pay you for their share of your bill, you simply don't pay them for your share of their bill. You do run a slight risk of having your gas cut off because Captain Shifty has forgotten to pay her bill. However it would have probably been better to choose a better flat mate.
- O.K. you have ended up sharing a large flat with a bunch of scroungers who are just not going to be able to cope with even managing a single bill. There is a solution that, although a pain in the back end to sort out, could save you a lot of bother - get a shared bank account. You could work it like this:
o Set up an account with any of the main banks in the name of the flat.
o Get a cheque book that requires two signatures.
o Appoint 3 trusted people to operate the account (so if one of the signatories is on a field trip in Mallorca when the phone bill needs paying, you don't end up being cut off)
o Set up standing orders from everybodies' account to pay a regular sum into the shared account on a monthly basis. Choosing the right amount will not be easy but best to try to work out a worst case, add 50% and then just write cheques to each other if you find that you have too much sitting in the account. Again having regular direct debits will help you.
o Get all your bills put into everybodies' name so that everybody is legally responsible for the bills.
o Pin the statements up somewhere so everybody can see that the signatories have not paid themselves £200 to help them survive until the next grant cheque and that everybodies' standing orders are still being paid.
You may be able to find a bank or building society that will actually pay you £25 or so to open an account. You should also be able to negotiate an absolute minimum of £100 free overdraft as well. This will give you a little bit of a buffer if your budgeting is off the mark.
Phone Bill - Yes it is possible to fall out over 5 pence. If you have ever tried to divide an itemised phone bill up, you will know just how easy it is to wind the whole house up. One excellent solution is to find a phone company that will send individual bills. Each of you will be given a PIN number that you enter before you dial the number you are calling. This will be used to generate individual bills.
You may have read our recommendation about Telecom Plus in our section about setting up your utilities. Unfortunately they do not offer this pin service but we are campaigning on your behalf! If you do sign up with them please remember to suggest it when you sign up! Cable and Wireless do offer such a service and we have had good experience of using it in the past. However we found their web site far from easy to understand and we didn't get any further on the phone. They may be worth a look though.
If you can't get this service then we suggest that for your own benefit you keep a record of the calls you make and try to encourage your flat mates to do likewise.
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