Help reducing outgoings

qaiq

Hi there,

I'm hoping ome of you could give me a hand identifying where I can make some savings in my outgoings. A little background first:

We've got a new baby, and my OH is now not working at all & won't be for some time (her employer has made it impossible to return, although nothing illegal). I'm now the sole earner, and I do earn a pretty decent wage (£28,500 gross pa). Trouble is, our outgoings are based on two of us earning, and now there is only me it leaves things a bit tight.

We live in a village, and I work in the nearest city so I really need to have a car - public transport isn't an option as its a 2 hour (with bus changes) each way or a 20 minute car trip.

I don't want to take OH's car away - again as the bus service in the village is flaky at best and being at home with an infant and no way to get anywhere is not going to be good. Plus her parents also live in a village, so a bus journey is again a multiple bus 2 hour journey each way.

OH is doing some ironing work, for which she needs transport, which gets us around £15/week. I have recently started a business which I'm hoping will bring in more as well.


Here's a brief SOA:

Net Salary: £1,704
Benefits: £120
*Total Income: £1,904

Mortgage: £266.50
Rent: £180
*Its a shared ownership property, first time buyers
Life Ins: £0
Contents Ins: £15
*we just got this, basically for baby/accidental damage)
Council Tax: £112
Water: £22
Gas: £42
Elec. £42 (gas/elec are a combined quarterly bill)
Housekeeping: £271
*Includes food, nappies, other baby related items
Telephone: £25
Mobile: £25 (her mobile, I don't have one)
TV: £13
Travel: £170 (my petrol of £130, hers to visit her mum etc)
Car: £88.26
* RAC cover for both, MOT & Tax & some garage work
* we averaged last years bills
Car Ins: £101.90
*my insurance is £60, I've only been driving a year. Had a motorbike but sold it.
Clothing: £60
*again mostly baby clothes, and my work clothes (new set of baby clothes every few months, we buy a lot of 2nd hand but still)
Other: £50
*tends to be taking baby out (ie swimming, about £5-10/month)
*other one-off expenses (ie boiler, house maintenance etc)
* we averaged last year's expenses for this
*Total: £1483.66

Loans:
Car Loan: £150 (MY OH's car loan)
Pay off Debt loan: £169.42 (I paid off debts I previously had)
Pay SLC arrears: £30 (explained in another thread, search for Student Loans Repayments)
*Total Loans: £349.06

*Total Income: £1,904
*Total Outgoings: £1833.06
*Disposable Income: £70.92

Overdraft:
£1,500 (we can manage this currently).

A more simplified version is this:

Income: £1,704
Fixed Bills: £1,246
Food money: £200
Expenses (ie petrol, car tax, etc): £250
Total: £1,696
Left: £8
Benefit (mine & OH's): £40 tax credit + £80 child benefit

Both loans have 2/3 years left to pay, neither are in arrears.

In my other thread (Student Loans Repayments) you'll see why I want to reduce our outgoings.

Any ideas on reducing my outgoings?

Tixy

Hi

qaiq wrote: »

Here's a brief SOA:

Net Salary: £1,704
Benefits: £120 are you sure you are getting all you can here? have you checked?
*Total Income: £1,904

Mortgage: £266.50
Rent: £180
*Its a shared ownership property, first time buyers
Life Ins: £0
Contents Ins: £15
*we just got this, basically for baby/accidental damage)
Council Tax: £112
Water: £22
Gas: £42
Elec. £42 (gas/elec are a combined quarterly bill) These look a bit high, have you shopped around recently? for both supplier and then make sure you have the best tariff (usually an online one paid by DD). Have you tried to reduce your usage?
Housekeeping: £271
*Includes food, nappies, other baby related items Should be able to shave a bit off this. Have you compared nappies with cheaper ones (lidl are apparently meant to be good but cheap). Do you get toiletries/baby wipes etc from places like £shops/wilkinsons etc? Have you tried meal planning for a week before you go shopping? have you tried different supermarkets or an online comparison to compare prices? have you tried the downshift/drop a brand challenge?
Telephone: £25 does this incl broadband?
Mobile: £25 (her mobile, I don't have one) can she drop to a lower tariff?
TV: £13
Travel: £170 (my petrol of £130, hers to visit her mum etc) do you drive efficently? always fill up at the cheapest place? are all journerys essential?
Car: £88.26
* RAC cover for both, MOT & Tax & some garage work
* we averaged last years bills Next time consider looking for cheaper cover than RAC
Car Ins: £101.90
*my insurance is £60, I've only been driving a year. Had a motorbike but sold it.
Clothing: £60
*again mostly baby clothes, and my work clothes (new set of baby clothes every few months, we buy a lot of 2nd hand but still) Think you might be able to reduce this a bit further. Baby shouldn't need that many changes of clothes when they grow so quickly. Do you have siblings/friends with a slightly older child you can have passdowns from?
Other: £50
*tends to be taking baby out (ie swimming, about £5-10/month)
*other one-off expenses (ie boiler, house maintenance etc)
* we averaged last year's expenses for this
*Total: £1483.66

Loans:
Car Loan: £150 (MY OH's car loan)
Pay off Debt loan: £169.42 (I paid off debts I previously had)
Pay SLC arrears: £30 (explained in another thread, search for Student Loans Repayments)
*Total Loans: £349.06

*Total Income: £1,904
*Total Outgoings: £1833.06
*Disposable Income: £70.92

Overdraft:
£1,500 (we can manage this currently). If you pay interest on this then you haven't included that monthly cost anywhere so far.

Both loans have 2/3 years left to pay, neither are in arrears.

We live in a village, and I work in the nearest city so I really need to have a car - public transport isn't an option as its a 2 hour (with bus changes) each way or a 20 minute car trip.

I don't want to take OH's car away - again as the bus service in the village is flaky at best and being at home with an infant and no way to get anywhere is not going to be good. Plus her parents also live in a village, so a bus journey is again a multiple bus 2 hour journey each way.

OH is doing some ironing work, for which she needs transport, which gets us around £15/week. I have recently started a business which I'm hoping will bring in more as well.

The current problem is that the SLC are demanding I repay my loans at a rate of £160/month, which I don't have. Thye say they won't accept reduced payments because I am paying 2 loans (not reduced payments with no arrears). The 2 loans are with our bank who have our current accounts, overdraft & mortgage. We like the bank (Nationwide) so don't want to p*ss them off.

Any ideas on reducing my outgoings?

Just a few ideas above.

Whilst I understand you don't want to leave her carless is there any chance you could sell the car to pay off the loan and then just get her a cheap runaround for whilst she is not working?

pennypusher

I would suggest you fill in a SOA (Statement of Affairs) which will details your expenses a bit better for people to be able to comment. Is Child Benefit included in your benefits total? It would be helpful if you could break down the housekeeping total so that we can see what you are spending on each items. Mobile you could go pay as you go.
I think Tesco do an offer where you can get RAC cover very cheaply - you could check that out.
Check out Freecycle you could get lots of babyclothes off of there.
I hope these ideas help. Oh and don't forget to go on the comparison sites to see if you can get your electric/gas/insurance cheaper. See if your council will let you pay your council tax over 12 months instead of 10.

RAS

HAve you applied for working tax credit?

qaiq

Hi, thanks all for the advice & ideas so far.

* Re benefits: Yes, this is all we're entitled to - we have checked both with the SureStart money person & with HMRC directly. My fiance gets £80/month in child benefit and I get £40/month working tax credit so £120 in all.

*RAC: The RAC was really cheap when we started, but then my bike broke down 3/4 times so our current payments are somewhat higher than they would be ordinarily. I expect them to go back down again though (no more bike).

*Mobile & phone: Her mobile, yes we should look at reducing this or go PAYG. One obvious one is to cancel the insurance on it as our new home ins. now covers this.
The phone does include internet at £7.50 from O2. We get it cheap because she is on a contract with them, if she went on PAYG internet would jump to £18.50. I'm a computer programmer/web designer so I do use the internet for work (occassional jobs for people).

*The gas & elec is also higher than usual, we got a massive quarterly bill in Feb/March because of the cold winter, a 3 month old baby & OH staying at home all day with baby. Central heating was on a lot as was TV, etc.
We did look into paying by DD last year (pre-baby) but the amount they wanted per month was higher (£70) than what we put aside each month (£55) to cover the quarterly bill so it didn't seem worth it. According to uswitch we're on one of the cheapest quarterly tarriffs, but it is definitely worth looking again.

My driving isn't the best! I am used to riding a big bike & being able to overtake at will with negligible petrol cost. It's taken me quite some time (& a few near misses) to learn how to drive a car properly - When I started I used to drive it like a bike, rev it all the way up, downshift to brake, that sort of thing. I also tended to have the window down (I like the rush of air) but I've stopped that now & I'm getting better slowly

Oh, we've started shopping at Aldi (I prefer it actually, its quicker!), and we tend to buy cheap baby wipes (we do buy expensive ones for his bum though). Our actual food budget is £200. We do tend to spend all of that (OH is anaemic from pregnancy complications, but can't take iron supplements because of breast feeding (baby's liver?). We buy a fair bit of red meat).

I'll try your suggestions & see if anything can be cut. Thanks!

lilac_lady

I think you're doing pretty well on one wage. Cutting down on grocery shopping will save you a little bit though.

Tixy

Is OH not entitled to any maternity pay? (I never looked at the rules closely but I would have thought she should be getting SMP from her employer?)

qaiq

lilac_lady: Thanks, we're really trying! We actually want to get rid of our debt as soon as possible. The loans we have are up in 2 or 3 years so we just have to struggle along until then. Never, ever again after that. I'm sick of credit & debt.

Tixy, yes. Baby is now 10 months old so SMP has now stopped. It was about £400/month. We've lost about £18K of annual income, so now looking at ways to cut down on what we've accrued while we both had jobs.

Edit: I said I had another thread over in Loans regarding student loan repayments. They're asking for money we don't have which is why I've also posted on here to try to find ways to cut down on our expenditure.

RAS

Have you applied for all the benefits you can get, WTC, CTC etc?

www.entitledto.com

qaiq

RAS wrote: »

Have you applied for all the benefits you can get, WTC, CTC etc?

www.entitledto.com

That calculator gives me a figure of £30 weekly, which matches up with what we get monthly. Working Tax Credit (for me) of £40. Child Benefit (for OH) of £80. Not sure what child tax credit is though.

I confess I don't understand the benefits system at all. In the end, we went to the surestart money & benefits advisor with all our payslips etc and asked her to sort it all out.

OH's pay & finances have been so complicated last year & this (with full pay, 90% SMP, usual SMP, holiday allowance paid in a lump sum in arrears & up-front), pay rises, my pay rises, pensions contributions (I changed mine), benefits in kind, BUPA (I changed mine), maybe going back to work, not going back to work...

From what I can tell, and as far as people who are suposed to understand benefits have told me, we are claiming all we are entitled to. Makes sense not to get very much - I earn an above average amount of money so I wouldn't expect much benefit.

<rant>
Of course, when you read in the paper about people who 'earn' in excess of £100K in benefits who live in a nicer house than I do, I really feel the urge to pack it all in & live like a sponge.
</rant>