Reference no: EM133099107
Jose and Pep live in Birmingham with their two children, Alexis and Simon, aged 9 and 7. Jose, who works part-time as a clerk with the local council, has a net income of £13,000 a year, while Pep works full time and earns a net income of £25,090 per annum as a refuse collector. They currently rent their house, which has 4 bedrooms, the smallest of which they use as a storeroom for extra bits and pieces of furniture they have accumulated over the years.
They are keen followers of their local football club and each year they buy season tickets. This season their team is doing well, and the family are hopeful that a good run in cup competitions could lead to a semi-final, a final or even a win. They never seem to have money for special family days out or 'for a rainy day' and this is something that they would like to change. They would like to save at least £100 a month.
Table 9.3 Jose and Pep's average cash-flow statement
|
Income (net) £
|
Average Monthly cash flow £
|
|
Jose £13,000 a year
|
1,083.33
|
|
Pep £25,090 a year
|
2,090.83
|
|
Total income
|
3,174.16
|
|
Expenditure £
|
|
|
Rent £900 per month
|
900.00
|
|
Council tax £1250 a year
|
104.17
|
|
Food and household items £240 per week
|
1,040.00
|
|
Water £200 each half-year
|
33.33
|
|
Gas and electricity £350 per quarter
|
116.67
|
|
Broadband, TV and phones £85 a month
|
85.00
|
|
Transport £350 a month
|
350.00
|
|
Gym, leisure, meals out £200 a month
|
200.00
|
|
Annual season tickets for Pep and Jose
|
91.67
|
|
Annual season tickets for Alexis and Simon
|
33.34
|
|
Holidays
|
215
|
|
Total expenditure
|
3,169.18
|
|
|
|
|
Surplus/deficit
|
4.98
|
Examine the household case and their average cash flow.
What is the household's current cash-flow position.?
Identify possible factors that may affect this household's cash flow.
These factors may affect the household's expenditure or income.
These may be factors internal to the household such as its composition, or external factors from the current wider economic and social context of which the household is part.
What are the 3 top tips on how the household may improve its cash flow to allow them to make savings each month for 'a rainy day'