No Money - but BIG ambitions

frugalfrog

Weronika wrote: »

My friends still are joking about time I invited them for dinner and didn't have enough plates:embarasse

I had a similar thing at my friends house who only had 2 wine glasses :eek: I ended up drinking wine out of a pint glass :rotfl: Classy!!!!:D

frugalfrog

Weronika wrote: »

One thing I am pleased about is that our hospital gives out parking permit for £10 and it last for the whole pregnancy - 2 years ago we spend a fortune on appointments and when I had to stay in hospital after the birth. That's at least £50 saved in parking fees!

Thats a great idea! With my little girl we were paying about £4 a time, then I kept getting kept in for the night by the doctors in the last 2 weeks due to pre-eclampsia, cost us a fortune in parking!

Weronika wrote: »

Also, how do you budget for things like taxi from hospital? Do you keep emergency fund or something?

You could put a "misc" field in the SOA for an amount which will cover extra expenses that cant be budgeted for

frugalfrog

Also, £100 per month does sound quite a lot for baby stuff. I budget for about £30 (1 baby), but I use washable nappies/wipes & BF so no cost there. But it depends on how much you want to spend on your baby, as you could spend hundreds! (if mothercare had there way!)

There is something I have been looking at to save money on household cleaning products, which are horrendously expensive. I have been making my own laundry liquid etc for a fraction of the cost the stuff you buy in the supermakets.

Weronika

frugalfrog wrote: »

Also, £100 per month does sound quite a lot for baby stuff.

I wasn't sure what the costs would be, so I thought it's better to put more and than have money left than the other way round:cool:

I am planning on BF as well, so no cost there :j
I have sensitive skin and my first took after me, so I had to buy washing powder for allergic babies last time and change him VERY often to avoid skin irritation.
Luckily my HV gave me prescriptions for Oilatum bath and Doublebase cream for afterwards, so good £15 a month saved there:j

As I said my main problem with SOA is that I never counted my money this way - If I see something good value I would buy it regardless if I went over my supposed £100 pw budget.

For instance, when Matalan had sale I picked up tops for as low as £1.30 and lounge wear trousers for £4 - my friend said at the time she only got £20 left that week for food and she didn't plan any clothes shopping, so she didn't - and than bought exactly the same thing a month later for £10 per trousers and £5 per top! For me this is just silly waste of money and her idea for sticking to budget is actually costing her!

getmore4less

Weronika wrote: »

As I said my main problem with SOA is that I never counted my money this way - If I see something good value I would buy it regardless if I went over my supposed £100 pw budget.

For instance, when Matalan had sale I picked up tops for as low as £1.30 and lounge wear trousers for £4 - my friend said at the time she only got £20 left that week for food and she didn't plan any clothes shopping, so she didn't - and than bought exactly the same thing a month later for £10 per trousers and £5 per top! For me this is just silly waste of money and her idea for sticking to budget is actually costing her!

That is just a confusion of budget and cash flow.

The SOA is just a snapshot expressed as a month,

This is an example of why the budget is a plan for longer than month by month. Look at the next years and what clothes you "need" to buy and how much you want to allocate to "wants"

The plan is I will spend £400py so on average £33.33pm on clothes because I will "need"&"want" the following, a,b,c,d....... over the next 12 month(its the plan). you can spend all £400 to day or 33pm as long as you keep under £400 forthe year you have budget and stick to it.

if d a planned spend for Sept is available now for 1/2 planed spend you buy it now and have 1/2 the cost to either save or realocate to another catagory or add another clothes want.

You know you will have expences related to the baby so plan for them as best you can, so you set aside at least most of the expense, ok you might get it wrong. but the impact of the error is much lower any overspend has to come from somehwere.

Plan for the full year not just a month at a time.

Every time you have a new expence not on the plan add it to the plan and reballance the budget for the rest of the year.

All income needs to be allocated to a catagory, that can include savings/emergency funds.


Another trick is to identify the "needs" and the "wants" seperately,

Needs the trick it to aim to minimize them.

Wants are discretionary spends and need prioritizing once the needs are taken care of.

getmore4less

Weronika wrote: »

I am not sure if I'm missing the point - I do not know what my income is going to be - I cannot plan expenses without knowing how much it will be.

You plan based on what income you know you will have and balance a budget based on that.

You best guess the spends based on history or new goals.
Tracking tells you how goodthe guesses were and you re ballance if they were wrong, for very catagory that increases in the plan another has to go down.

When you know there is more income coming you can replan.

Untill you have a income/expense plan that ballances you don't really have a budget.

Have a look at
http://www.makesenseofcards.co.uk/soacalc.html
Which includes income and debt which also ballances.


Another option if it will fit better is to use annual amounts.

I quite like the annual approach since it normalizes expenses and gives a better idea of the relative costs of everything especialy discretionary spending where you have to make value choices.

Monthly is the defacto standard since it is used for debt management planning and most peoples income is monthly.

Weronika

[QUOTE=getmore4less;51166355]
You know you will have expences related to the baby so plan for them as best you can, so you set aside at least most of the expense, ok you might get it wrong. but the impact of the error is much lower any overspend has to come from somehwere.
Plan for the full year not just a month at a time.
Every time you have a new expence not on the plan add it to the plan and reballance the budget for the rest of the year.
All income needs to be allocated to a catagory, that can include savings/emergency funds.[/QUOTE]

1. Thanks for all your comments, I appreciate it!
2. I think this year is going to prove very trying - as I will have to get used to idea I cannot just work overtime to pay for what I fancy:cool:
3. On the other hand, shopping bill will probably reduce, because I am scared to death at the prospect of going anywhere with a toddler and baby;)
4. The way I look at my SOA is we should be ok, it covers most basic expenses, with mortgage OP included. The small emergency fund will be build up from £48 monthly underspend for things like taxis, medicines, emergency childcare.
5. We already got money saved up to clear the £3,800 credit card in July 2013, and it's earning nice 5% interest
6. Anything leftover will go to build back our ISAs as we cashed them to pay for the car last year.
7. Hopefully the increase in CB and WTC for 2nd baby will cover baby expenses, so we actually put more in emergency fund.
8. The £160 from March OP reduces mortgage term in half, so that's a good enough result for me until our fixed deal finishes in April 2013.
9. The only 1 thing that is spoiling all this is that in 2013 - 2015 I will need to find around £60000 - £80000 (depending on the currency conversion) to pay in the investment I already put £40000 in - there is 3 year limit to pay it or I lose everything so that's a worry. I just HAVE TO find a good job next year:eek: My parents offered financial help, but it just seems so pathetic to borrow money from parents after 30 birthdays:o I'll cross that bridge...
   

frugalfrog

Weronika wrote: »

I have sensitive skin and my first took after me, so I had to buy washing powder for allergic babies last time and change him VERY often to avoid skin irritation.

Both myself and DH have sensitive skin too, using a homemade liquid made out of soap flakes is good for sensitive skins as it contains no enzymes or chemicals, which can trigger reactions. This is what I use http://down---to---earth.blogspot.com/2010/08/homemade-laundry-liquid-revisited.html, it works out less than 1/2p per load (at Tesco prices).

I like getmoreforless "need" and "want" theory. It really makes you think about stuff before spending.

getmore4less

Weronika wrote: »

The only 1 thing that is spoiling all this is that in 2013 - 2015 I will need to find around £60000 - £80000 (depending on the currency conversion) to pay in the investment I already put £40000 in - there is 3 year limit to pay it or I lose everything so that's a worry. I just HAVE TO find a good job next year:eek: My parents offered financial help, but it just seems so pathetic to borrow money from parents after 30 birthdays:o I'll cross that bridge...

STOP WHAT YOU ARE DOING.

I can't comment on the investement it may be good or it may be a big mistake but you need a PROPER plan for this

If you are going to lose £40k you need to start saving EVERYTHING you can towards this, stop spending, overpayment, MORE BABIES etc.


Your budget/plan no longer needs to be a month or a year it needs to be planned out in detail through to 2015.


It is probably worth looking at the investment seperately to make sure this is a good one.

£100k is a lot of money(hope this is not some scam)


but it just seems so pathetic to borrow money from parents after 30 birthdays:o I'll cross that bridge...

NO you need to sort it out now have a plan that minimises bank of mum and dad.

Of course if this is a great investment then they will be happy to share the returns(having done their own due diligence).

Sepa74

Yes, it does seem crazy to OP the mortgage at all when you have to find that sort of money in such a short space of time. That £100 OP a month you are planning is £2400 less that you need to find over the next two years.