Live on £4000 for a year - part 4 (Oct - Dec 2008)

Frugaldom

Hi Ddraig, :hello: I'm glad you're still going to lurk here, I had been wondering where you'd got to recently.

4k is not a lot of money nowadays, shocking as it may seem. When I do my budget (again and again and again), there are a few things that I deduct immediately and there are a few things I don't include at all. To arrive at a budget figure, I find it easiest to write down the total amount coming IN over the complete year and then deduct all of the following:

Rent (or mortgage) & associated essential insurances
Council tax
Water

The above are things that MUST be paid before we can begin to budget for the way we live.

All Debt repayments

Repayments for all debts must be kept up to date to avoid it spiralling out of control, so these should be deducted before we begin to budget for the way we live.

Car and/or work related expenses, including childcare

These costs are associated with how we earn our income, not how much we pay for the cost of living.

Once you have deducted all of the above from your total annual income (including all benefits, tax credits etc) the balance you have left is what you have to cover the cost of living and anything else you want - mortgage over-payments, debt over-payments, savings, hobbies, holidays, luxury items, luxury gifts, days out, socialising, entertaining and major social occasions etc. If there isn't anything left for extras, then so be it - improvisation can be a great thing. However, many people find themselves in the situation that they don't actually have £4,000 left to pay their cost of living, so alternative 'frugalistic' strategies need to be employed.

I have been looking very closely at HOW I spend and how flexible I have been in what I include as basic essentials:

£2,500 on absolute essentials (health & safety - food, heat, light)
£1,500 on non-essentials (as detailed below)
Of the non-essentials, about £1,000 is for stuff that we all take for granted as being 'needed', such as telephone, TV, Internet access and mobile phones but really, if push came to shove, we could survive without these items. The other £500 is for complete non-essentials - the wants rather than the needs. What this means is that if the very wost happened, the household could SURVIVE on £2,500 for a full year.

The credit crunch can affect us in many sneaky little ways. Every company out there is trying to make us spend more money.

1. I've just read my Halifax One statement and noticed that they have increased my credit limit by £750 without asking me first! :eek:
2. I've just received a £30 discount code for a £60 spend
3. I've used several £1 off voucher codes to purchase items at £2.99 etc, etc, etc.

This is proving to be rather a lucrative time for us frugalites. We can compensate for any drop in interest payments by spending less and less to get more and more with the help of vouchers, discounts and cashback sites. Having studied all of the above in some depth and having counted up my entire year to date's extra 'income' from such sources, I am, more than ever, convinced that next year could be the start of something big! It's going to be hard work, but this thread offers all the moral support that anyone could possibly need and I hope everyone taking part will agree.

Finally, at the end of this lengthy, possibly boring, post, I'd also like to add that the prospect of living on £2,500 for a year may sound ridiculously cheap, but (if you are 40+) think back to your first job and compare it to how much you earned then. :rotfl: I earned about £1,500 per year and had to run a car off that, as well as live! :rotfl:

cw18

Great post Nyk :T

I'm going to have a bash at doing my sums that way tonight, and see how it compares to my choice of running "all in".

My first job (started late 1984) saw me bringing home £52 (or thereabouts) a week (so £2,700+ a year -- the employer I worked for was well known for paying well for clerical work). I didn't have a car until the following Summer, but either scrounged a lift to/from work with my Dad (if he was on the 'day' shift) or had use of a heavily subsidised (pay as you use) works bus.

I was also lucky that my Mum looked afte DD for me for free and we lived with them -- so my parents took my Child Benefit (£7-ish?) as keep for DD and £15/week for my keep. That then left me £37 from my pay cheque plus my single parents benefit (connected to CB back then - seem to recall it being around £4/week) to cover everything except food and household expenses for the two of us.

Marru

Good afternoon,

We are still ill here and off from nursery/school/work. I am hoping that tomorrow we could be back to normalish.

I am hoping to get some college work done today as to be able to get it checked tomorrow, clear out my hotmail from surveys and other things needing attention and then...drumroll...finally tackle my finances.

Nyk what you said about purely essential spends was really good. Thank you so much for that. My aim for 2009 is: simplicity and quietude. The first one relates to frugalism and to simplify my life and get into routine that should help life "flow" easier. The second one means that I will literally cut all the extra "noise" from my life i.e. TV, radio, internet games. This gives me more quality time that I seem to be short of constantly. It is to spend time with DD, my animals, get on with things that need doing and to earn extra pennies by decluttering and selling what I have accumulated.

I was going to set myself a mini challenge to not to go to the shops until Christmas eve for the big stock up but then I realised I am running out of spread and goodnes knows what else. I will get more organised, I will get more organised, I will...

shaz_mum_of__2

well guys

Heres my 2009 Budget
Groceries (inc cleaning toiletries and alcohol ) £2500
Gifts £300
Household maintainence and garden £100
House and contents inurance £180
Broadband £180
TV licence £140
Telephone £300
Gas £500
Electric £400
Clothing £100
Leisure (lotto,RSPB,eat out,hobbies £300

Total £5000

Thats for Me , hubby and 7yr old DS (and 17 yr old DS 2 weekends a month)

Shaz

Janey51

Good evening frugalites.

Had to go into Mr T's this morning for screenwash but managed to get 2 x 3L cartons of milk reduced to £1.15 each :T
I will freeze this in 1pt amounts to use as I need it.

Diesel was .99p/l so I half filled the car....thinking that a full tank will increase fuel usage. I have a 70 mile round trip to do tomorrow so the cheaper diesel is excellent. It is £1.06/l in the local garage so a good saving.

I have one present to buy and then I am ready for Santa to collect and deliver

Feeling quite sad as DH isn't here to sing Christmas Carols to me as usual. Had a few tears driving home when Shakespeare's Sister came on singing "Stay".
If you remember the video, you'll know why.

slowlyfading

:hello: everyone, and sorry for not updating.
Firstly, thank you SO much for all the birthday wishes. I had a great day with family and friends, which went into the wee hours of the morning! Though I can't believe its over! Lol it always wizzes by so fast.
Secondly, I lost my job today. They couldn't afford to pay me so after my shift, my boss sat me down and told me.
Hope everyone else is okay. xx

Janey51

Oh SF so sorry to hear your news...and just before Christmas is awful.

Any prospect of other employment soon?

Penny2myName

Janey I remember the song and video, as its actually one of my favourites, :grouphug:

SlowlyFading, sorry to hear about your job:grouphug: for you too.

sophiesmum_2

Sorry to hear about your job SF:grouphug:

slowlyfading

Janey51 wrote: »

Oh SF so sorry to hear your news...and just before Christmas is awful.

Any prospect of other employment soon?

I don't know I have another job for the weekend, so I'll ring up tomorrow and see if there's any spare hours. if not, I guess its looking around.

Penny2myName wrote: »

SlowlyFading, sorry to hear about your job:grouphug: for you too.

Thanks sweetie

sophiesmum wrote: »

Sorry to hear about your job SF:grouphug:

Thanks xx