Budgeting for a month on Statutory Sick Pay

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Statutory Sick Pay is a flat sum with a ceiling, and for most people it is lower than normal pay. Knowing the figure before an absence starts, or in its first days, gives you time to adjust spending rather than finding out when the next payday arrives. This article works through the arithmetic with the 2026/27 rate, then shows how to turn it into a plain monthly budget. The sick pay calculator gives your own figure in a few seconds.

What SSP pays

For 2026/27, SSP is £123.25 a week or 80% of your normal weekly earnings, whichever is lower. It is paid for up to 28 weeks, by your employer, through your normal wages, with tax and National Insurance deducted where they apply. Since 6 April 2026 it starts on the first qualifying day of sickness, and there is no minimum amount you must earn to be eligible.

Your average weekly earnings are worked out over the 8 weeks before the absence. Two things follow from the "whichever is lower" rule:

• If your average weekly earnings are about £154.06 or more, 80% is above £123.25, so you get the full £123.25.
• If you earn less, you get 80% of what you earn. Someone averaging £140 a week gets £112.

Your contract or handbook may say your employer pays more than SSP under a company scheme. GOV.UK says to check your contract. If it does, your budget changes, so find that out first.

Three examples

These are worked examples, not typical cases.

Full-time wage. Someone earning £520 a week gross gets the full £123.25. Over four weeks that is £493 of SSP against £2,080 of normal gross pay, a gap of £1,587 before tax. That gap is what the budget has to absorb or cover from savings.

Part-time hours. Someone averaging £200 a week gets the full £123.25, because 80% of £200 is £160, which is above the ceiling. Their weekly pay falls by £76.75.

Low hours. Someone averaging £100 a week gets £80, since 80% of £100 is £80. Under the old rules a worker earning this little would have missed out entirely, which is why the 2026 change matters most at this end.

Your own figures will differ. Daily rates, if you are off for only part of a week, are covered in our guide to how SSP is worked out.

Working out the gap

A budget on SSP needs two numbers: what comes in and what goes out.

1. Income. Take the weekly SSP figure, multiply by the number of weeks you expect to be off, and add any other income that continues, such as a partner's pay, benefits or a second job.
2. Fixed costs. Rent or mortgage, council tax, utilities, phone, broadband, insurance premiums already in place, travel you cannot avoid, and any debt repayments already agreed.
3. Variable costs. Food, fuel, clothes, going out, subscriptions.

Subtract the second and third from the first. If the answer is negative, the difference is what savings or cuts must cover each week.

Which costs to look at first

Fixed costs are usually the largest, and the hardest to change in a hurry, so it helps to look at them in order of how much room there is.

• Subscriptions and memberships. Many can be paused for a month or two.
• Variable spending. Food and travel often have the most flexibility, and you can set a weekly limit.
• Contracts with a fixed term. Phone, broadband and similar usually cannot be cut mid-contract, but you can ask the provider what it offers if your circumstances have changed.
• Priority bills. Rent or mortgage, council tax and energy are the ones to protect. If you expect to struggle with any of them, contact the provider before you miss a payment rather than after.

Setting up a simple system

You do not need a spreadsheet. The point is to see the month at a glance and stop spending creeping past the limit.

A Ad monthly budget planner book gives you a page for income, a page for bills and a page for tracking spending, and a single book is easier to keep up than scattered notes. If you prefer to separate money by purpose, Ad cash envelopes with budget category dividers let you put the weekly food or travel amount in cash and stop when it is gone. That works for variable spending only, and rent and bills are better left on direct debit.

SSP arrives with your normal wages, so your payday does not change, but it helps to see rent dates, direct debits and payday together. Ad A wall calendar with large date squares lets you mark all of them on one page. Ad A bill organiser folder with monthly sections gives paper statements and receipts somewhere to go, so you can see what has been paid.

For a household with more than one person, Ad a magnetic fridge whiteboard keeps the weekly spending limit in view for everyone.

Testing a few scenarios

Absences rarely last exactly as long as expected, so run the numbers for two or three lengths. Four weeks at £123.25 is £493, eight weeks is £986 and twelve weeks is £1,479 before deductions. Put each total next to what you would normally have earned over the same weeks. If the gap at twelve weeks is more than your savings, you know to make cuts now, rather than part way through.

Check the payslip

Compare the first payslip that includes SSP with your own calculation. The figures to check are the number of qualifying days paid, the daily rate, and that the 80% rule has been applied if your earnings are low. Employers must pay at least the statutory amount, so if it is short, ask payroll to show their working.

Plan around the 28 weeks

SSP is paid for up to 28 weeks. If an absence could run long, find out early what your employer's scheme provides, since a company scheme may pay more. Our guide to long-term sickness at work covers what your rights are as the weeks pass. Planning for the end date is easier at week four than at week twenty-six.