Don’t be sloppy with your money: make sure to get what is due to you

sloppy with money

One thing I know well is debt. Small wonder this is: I lived with debt for quite a few years before we reached a crisis point and dealt with it once and for all.

Debt, however, is just a symptom while the illness is in a number of behaviour patterns we acquire on the way.

My illness was in:

  • Refusing to talk about money;
  • Refusing to check on my money;
  • Convincing myself that I need stuff (I didn’t really);
  • Not having a big, fat dream for my life; and
  • Being sloppy about money.

How can one be sloppy about money, you may ask?

Well, let’s see:

  • I’ll lend people money and forget about it;
  • I never knew how much cash I have in my wallet;
  • I’ll always pick the tab when out with friends; and
  • I’ll leave money ‘on the table’ because it is too much bother to do anything about it.

Most importantly, I somehow always neglected to claim what is due to me. Want an example?

I travel for work quite a bit and this means claiming expenses. Did I do it? Yes. It just took me on average six months to claim my expenses because I hate filling in forms, you see.

This kind of behaviour is bound to get you in debt and very likely keep you there.

Debt is like any illness: cure is in tackling the causes not simply treating the symptoms.

Paying of our debt, and staying out of debt for about eighteen months now, came together with learning to get what is due to me (us). Today, I claim my expenses and do it on time.

Here are three examples of large claims we made which we would have probably ignored before…

“Make sure to get what is due to you!”

…became our battle cry.

Example 1: Increasing the interest on a credit card without letting us know

This happens. Credit card companies do increase the interest rate on borrowing.

When this happens, or any other change to the rules and conditions of the credit card, we usually get a letter from the provider telling us that.

This was not the case with one of our credit cards. It was John’s (my friends, meet my husband) and he’d had it for about twenty years. During this time the credit card changed ownership several times. This can happen as well.

What shouldn’t happen is for the last provider (MBNA) to jack up the interest by several percent without informing us.

John checked the balance from time to time (remember the behaviour about not checking ones money) but never noticed that the interest has changed.

(Note: John did notice that MBNA don’t calculate the interest correctly and make quite a bit of money this way but this is another story.)

When he finally clocked this up, John put the case to the ombudsman and won.

This cost MBNA over $15,000 which went immediately to our debt repayments.

Lesson 1: Be prepared to claim what is due to you if you’ve been wronged.

Example 2: Underpaid Child Benefit

Now this needs a bit more explaining for my friends in the US.

In the UK, there used to be a universal social payment that was known as Child Benefit. This used to be paid directly to the mother and was intended to help towards the support of children. Child benefit was worth $36 per week for the first child in a household and $23 for any subsequent child.

Not much but we saw it as our right as part of the welfare state (this is part and parcel of the same welfare state through which we have free access to healthcare and education). This is all changing at the moment and we as a family are not eligible for this any longer.

In March 2012, John write a commentary on the UK Budget and his key points were about the problems with changing the Child Benefit.

I read his article: after all I’m the Mistress Supreme of The Money Principle (or the publishing editor, in more tame terms).

“John, you’ve got the Child Benefit payment wrong.” – I said. “We certainly don’t get $36 per week.”

John’s numbers were right. What had gone wrong was that our third son was never changed to be the first/only child in the family.

As a result we had been underpaid a bit of Child Benefit for a very long time (about ten years).

We contacted the appropriate agency and they paid the different without any problems.

This was over $5,000 (and it made a nice lump sum payment towards the debt).

Lesson 2: Learn what is due to you! Having a budget is very useful but not enough.

Example 3: Sneaked in Payment Protection Insurance (PPI)

You may have heard that claiming PPI is all the rage in the UK at the moment and has been for several years now.

It is not a fashion: it is a really big, bad scandal. In a nut shell this is a payment protection insurance that allows borrowing to be repaid if the borrower become ill, dies, loses job or something else that can prevent him/her happens. Thing is, that the cover is for the minimum payment and it is for a certain period.

In other words, not terribly useful.

Still people were duped into buying 34 million PPI policies since 2001 and these were found to be mis-sold. As a result, almost $24bn were set aside by banks and building societies for compensation.

What this has to do with us, you may ask; after all we are financially literate people who are not likely to fall for something like that.

You’d be right: we didn’t. Still when John was checking some financial statements from the mid-1990s he noticed, for his great surprise, that we’ve been charged PPI for several years.

We could have noticed earlier. But we didn’t look for PPI payment because we never bought it: the bank sneaked it in.

For this one, our claim is still with the ombudsman and we are waiting to hear what the outcome is. I won’t be surprised to get a payment of several thousand at the end.

Lesson 3: Check regularly whether you are paying for something you haven’t bought.

Finally…

 

My examples probably don’t have direct equivalent in the US. Still the message, I believe holds:

“Make sure to get what is due to you!”

For that you need to know what is due to you, make sure that you are not paying for stuff you haven’t bought and be prepared to fight if you’ve been wronged.

Have you ever ‘left money on the table’ because it is too much bother to claim it? Have you ever been sloppy with your money?

12 Responses to “Don’t be sloppy with your money: make sure to get what is due to you”

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  1. Overall I’ve had moments where I didn’t pay close enough attention to what money was coming in versus going out, and I would get dangerously low with my checking account..now I’m almost a bit too the other way. If a client is late on payment I’m all over it, and I know sometimes I have to walk a fine line between being proactive versus being a nag. I have a close friend though whose former roommate owes him 3k in deposit money and he isn’t going after hime. Best believe that would NOT be happening with me. That’s crazy!

    • Maria Nedeva says:

      @Tonya: Yep, this is what I’m talking about: your friend with the roommate oweing them a lot of money. And I agree that it is a balance but I still think that now I check my account every couple of days (when we had debt I did it every day and hought that our minuses are too many) is better than not seeing my bank balance in ten years. It is not always good news butI know and when I know I can do something about it.

  2. I read a lot of personal finance articles, so it’s hard to find new topics, but this one is not talked about enough. Kudos to you.

    I’m sloppy by not taking the time to calculate how much I’ll save or spend with little choices I make.

    Take today for example. I sold 3 books on Amazon. Each book was a different price, different Amazon fee, different shipping costs. Amazon gives an estimate of how much I’ll earn on each book, so I usually just go with that and not bother with more exact figures.

    Then I realized I was being sloppy. How would I know if it was really worth it financially to go through the trouble of selling on Amazon? I was just hoping it all worked out!

    So, I stopped packing the books and paused in the post office to calculate exact profits, then I used that knowledge to decide how to insure my books and maximize my profit.

    And, yes, there have been times I didn’t go back and fight for that refund, overpayment, etc. because I thought it would be more trouble than it was worth. However, since I’ve been on this debt journey I’ve learned to respect my hard-money (which is really God’s money), and that means not being sloppy.

  3. I feel like I’m in that position a lot. Luckily, I’ve gotten a lot better at asking for what is due me.

  4. debt debs says:

    Good job in getting money that was yours for the taking! I had the same illness as you. I’m much better about money but I’d be lying if I said that some things still overwhelm me. Truth be told, I don’t know if my problem is more in time management than money management. Thanks for sharing your experiences!

    • Maria Nedeva says:

      @Debt Debs: You are raising a very good question here; in my experience both time management and money management issues have a common cause which is low control. I had to learn control.

  5. I thought I was reading about me for a while there! I also hate filling in forms – even to get reimbursed for something. And although I’m entitled to get coverage for mileage through the year – when I use my car to drive to book fairs or to purchase supplies for the school library for instance – I don’t bother. Too much trouble. Not worth the effort. OK, so no more of that! Thanks for sharing your own personal finance shortcomings and for helping me to recognize mine.

    • Maria Nedeva says:

      @Prudence Debtfree: Ha, ha! Yeah, there are too many people like that. I suspect that my university takes full advantage of the many people who don’t claim their expenses for many months. Now they have a rule that if you don’t claim within twelve months you can’t claim. Every time you are faced with this forms remember that your employer not only exploits (they all do ultimately) but they also make money from your sloppiness. Don’t let them!

  6. MomCents says:

    This just inspired me to do something I’ve been meaning to do for a long time….

    I got some money (don’t know how much) tied up in the office of unclaimed funds. It’s linked to my maiden name and address in a different state. I’ve already done the legwork to pull all the proper documents that link my old address and name together. I just have to get one more form notarized and send off….why haven’t I done it? This gets pushed to the way side time after time! I’m off tomorrow — I need to GET THIS DONE!

    Thank you!

    • Maria Nedeva says:

      @MomCents: You said it: GET THIS DONE. If twenty of the people who read this post do something about claiming money that’s due to them my job is done ;).

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