Where does it all go???

RhiBi

We really need to sort out our spending, or rather mine. We are constantly overdrawn each month and I don't know what I spend half of it on

DH has a well paid job this months salary was £3200, I don't work as we have 4 children and child care costs are too high. When my youngest daughter goes to school in Jan 2010 then I am hoping to find something part time at the school!

Here is a list of income and expenditure. We are a family of 6!

INCOME

Salary varies between £2500 and £3300
Child benefit £225.80
CH tax credit£44.68

Child benefit and ch tax credit goes into my smile online account and I try not to touch it so that we can pay for Christmas although this year we haven't saved it, and are relying on a maturing savings plan to cover Christmas this year.

MONTHLY EXPENSES

Mortgage around £500 a month
Car Loan £187 - finishes August 2009
Pension payments £100
Council tax £90
Gas/Elec/Phone £130
House insurance - I think around £20
Savings plan £30
Car insurance is £250 but paid annually in January
Sharps bedroom £90 finishes January 2010 can be paid off earlier at no expsense
Groceries £280 - been doing a menu plan which has really cut down costs
School dinner £28 (other daughters have packed lunch which is included in above grocery shop
Dell computers £14.99 finishes next month
Tiscali broadband £14.99
Piano lessons £80 for 2 daughters
Horse Riding £64 for 1 daughter
Brownies/guides £16
Mobile phones £33 for 2 contract phones
Daughters pocket money £30
Credit card has around £3000 on it
Petrol around £120

We have an authorised overdraft with a limit of £3000 this month just before DH's pay went it we were overdrawn by £2800

I am ashamed to say that in May this year I had a savings policy mature of £3300 and its gone. Both DH and I have one each maturing in October this year with a value of around £3000 each.

Why are we so overdrawn and we should be able to live within our means with DH's salary.

We have had an expensive time with getting DD's christened so that hasn't helped. DD1 has her birthday party on July 15th which will cost around £130 and DD2 has her birthday party on July 18th which will cost around £70 (deposit already paid!) We are going to Tenby for a wek on July the 19th, caravan is fully paid for so only need spending money, we are planning to use this month child benefit for that!

When can we cut back and get out of the overdraft? I feel we're constantly saying when the car loan finished, when the bedroom payment finishes etc

My mother has a house in Florida and I would love us to be able to go out there every other year, but I can't see how we will get there unless we start to save and sort out the spending,

Do any of you experts have any suggestions for us please?

G-G_4

I'm not an expert, but the above expenditure doesn't include, birthdays, xmas, days out, clothing etc.. maybe this is where you are overspending?

If I were you I would buy a little booklet for 99p and write down EVERYTHING you spend your money on, (all of the family).. and then at the end of the month work out what is being wasted and where.

Your shopping budget is excellent - well done!

I'm a family of 2 adults and we are spending £200-£250 a month on groceries, so you are doing very well there

tyllwyd

I think you need to sit down and do a proper detailed SOA (statement of affairs = budget) - you could use the one here
http://www.makesenseofcards.com/soacalc.html

You've left almost all your car costs, for example. It must be difficult to budget if your income can vary by £800 a month - I think you need to budget on the lower figure, so that you can use the extra for savings/treats rather than relying on it.

Is your groceries budget really honestly £280 per month for six people??

RhiBi

I've just done an online shop at Asda, and it came to £67. I had a voucher for free delivery, and I've done a menu plan for the week and bought for that, and things for childrens and DH's packed lunch.

I will need bread and milk for the week but thats about all

Thanks for the link as well, I need to get the statements out - most of them are unopened, and go through them!

ETA - clothes and things for the children are where most of my spending does go!

RhiBi

Here is my SOA, I am not exactly sure on some of the amounts, I have no idea how much a tv licence is even.
Statement of Affairs and Personal Balance Sheet

Monthly Income Details
Monthly income after tax................ 2600
Partners monthly income after tax....... 0
Benefits................................ 225.8
Other income............................ 44.68
Total monthly income.................... 2870.48

Monthly Expense Details
Mortgage................................ 500
Secured loan repayments................. 0
Rent.................................... 0
Management charge (leasehold property).. 0
Council tax............................. 89
Electricity............................. 30
Gas..................................... 40
Oil..................................... 0
Water rates............................. 25
Telephone (land line)................... 30
Mobile phone............................ 33
TV Licence.............................. 12
Satellite/Cable TV...................... 18
Internet Services....................... 15
Groceries etc. ......................... 280
Clothing................................ 80
Petrol/diesel........................... 120
Road tax................................ 20
Car Insurance........................... 20
Car maintenance (including MOT)......... 0
Car parking............................. 0
Other travel............................ 0
Childcare/nursery....................... 0
Other child related expenses............ 30
Medical (prescriptions, dentist etc).... 0
Pet insurance/vet bills................. 0
Buildings insurance..................... 30
Contents insurance...................... 0
Life assurance ......................... 130
Other insurance......................... 0
Presents (birthday, christmas etc)...... 20
Haircuts................................ 10
Entertainment........................... 0
Holiday................................. 0
Emergency fund.......................... 0
school meals............................ 28
hobbies................................. 160
Total monthly expenses.................. 1720

Assets
Cash.................................... 0
House value (Gross)..................... 115000
Shares and bonds........................ 0
Car(s).................................. 4000
Other assets............................ 0
Total Assets............................ 119000

Secured Debts
Description....................Debt......Monthly...APR
Mortgage...................... 53000....(500)......0
Total secured debts........... 53000.....-.........-

Unsecured Debts
Description....................Debt......Monthly...APR
MBNA...........................300.......100.......0
Sharps bedroom.................2700......90........0
car loam.......................0.........187.......0
Total unsecured debts..........3000......377.......-

Monthly Budget Summary
Total monthly income.................... 2,870.48
Expenses (including secured debts)....... 1,720
Available for debt repayments........... 1,150.48
Monthly UNsecured debt repayments....... 377
Surplus(deficit if negative)............ 773.48

Personal Balance Sheet Summary
Total assets (things you own)........... 119,000
Total Secured debt...................... -53,000
Total Unsecured debt.................... -3,000
Net Assets.............................. 63,000

Created using the SOA calculator at https://www.makesenseofcards.com.
Reproduced on Moneysavingexpert with permission.

======== Enter any other useful information below ========

e.g. the number of adults & children in the household, the number

of cars included in the SOA or anything else that may be useful.

tyllwyd

Well, your SOA doesn't look extravagant, and according to that you should have at least £1000 spare at the end of the month ... which obviously isn't happening in practice! I agree with the previous poster, you need to track your actual spending for a while, to discover where your money is going.

A couple of things - your life insurance is very high. Does it include critical illness?
You haven't put anything for entertainment or holidays, or for car maintenance. You've only allowed £20 per month (£240 per year) for birthdays, but you have already mentioned that you are spending at least £200 on parties for two children - so that budget can't be realistic. I think you need to be brutally honest with yourself and write down what you acually spent, not what you think you should have spent.

Ames

You've also got child expenses down at £30, but the horse riding and things you put in earlier come to £160. Also there'll be school trips and things wont there?

whiteroom184

Hi RhiBi


your balance sheet and problems looks similar to mine 3 months ago, the only thing missing (and i think its missing off yours too) is denial! do what the others guys are saying and keep a spending diary, it will surprise you, literally write down everything.

its hard to do and hard to remember to do but if you keep yourself disciplined with it you will learn to think about every penny in your purse

WorkingHardDFW

I would agree with the previous posts. You need to budget for absolutely everything you spend money on from childrens activities, lessons, window cleaning, food, newspapers, birthday cards etc etc. I know from experience that the money still gets spent and if is not budgeted for it comes from somewhere.

I started a spending diary spreadsheet on the PC in Jan and I can say that its still going strong. I put all my receipts on a spike and every couple of days or weekly at the latest I input them. All spending is done my category like: childcare costs, cc activities, petrol, food, household, medical, pet etc etc. I've did my 2008 budget before the SD but I've reviewed the SD several times and adjusted the budget accordingly. Its fantastic and I would recommend it since it shows you exactly when, how and on what you money is going.

Good luck

whiteroom184

the spike is an excellent idea, i used to write everything down in a double entry book, but figured i was too lazy, so now i use my debit card for all spending so when i see my statement or online account i can see the brutality of my expenditure!

waggys

I would also add your telephone bill and broadband could be better sourced. You are paying quite a lot for the two. I pay £30 for cable tv, phone with talk 24 unlimited and broadband with Virgin. Currently one of the cashback sites (can't remember if it is topcashback or quidco) is offering £100 cashback to new virgin customers and you can get all 3 services for £30 per month - worth exploring. Car insurance, buidings and contents, I would also look at the cashback sites when it comes up for renewal. Your children have some rather expensive hobbies!!!