where to cut?

litespend

Hi everyone, I'm looking for areas to cut spending as I've started racking up debt.. £3500 as of now, but it looks like it's not going down (luckily it's at 0% interest until 2015). I'm a single mother with one school-age child living in London.

mortgage: £1208 (hopefully this will reduce to £1050 in May next year when I renew the mortgage deal)
contents insurance: £10
service charge: £80
council tax: £100
gas & electric: £80
water: £25
Internet, TV, home phone, intl calls £60 (contract 2-yr)
tv license: £12
mobile: £25 (contract 2-yr)
bank account charge incl mobile phone insurance: £6.50
website hosting: £5
monthly transport pass: £115
before/afterschool club (childcare): £200
afterschool activities (swimming & music): £40
groceries including school dinners & work lunches: £450
CC payments: £100/month

I don't really eat out (other than subsidized lunches at work, it comes to £4/lunch), I don't do takeaways or coffees etc. As you can see the above is everything that leaves my account every month and after these payments are going out I'm left with about £500 each month for clothes, cosmetics, entertainment, vacations, home repairs, medicine, etc - and the reality is that I don't vacation anymore, aside from family visits to see grandparents.

Any ideas? Thanks!

PasturesNew

£4/lunch might look like a good deal, but if you made your own lunches you could easily save £3/day on that without suffering or skimping on food. 20 working days/month x £3 = £60/month saved.

£500 left over is a small fortune too.... many people don't start with that much before they eat etc.

litespend

Thanks, but I'm not really sure how I could eat a healthy lunch for £1 even if I cook it from scratch?

See that's the thing, £500 might seem not as bad but it's just not enough, as it's always something that needs to be paid... just recently plumber came in £80 charge etc.

marathonic

litespend wrote: »

Thanks, but I'm not really sure how I could eat a healthy lunch for £1 even if I cook it from scratch?

The supermarkets always do good 3 for £10 on various chilled meat products. One of these is usually enough for two peoples dinners with enough left over for the next days lunch. Add some microwavable steamed vegetables and you've got a good healthy lunch for about £1.50.

The occasional plumber charge of £80, and other such expenses, is not where the bulk of your £6,000 per year leftover money is going. It'll be the small things like the daily coffees and lunches or, perhaps, magazines and the likes.

You're asking us to advise you on where to cut yet the majority of your list is for fixed expenses that cannot be cut. You then conveniently categorise all the expenses where cuts are most likely to be possible into the £500 leftover category. Chances are you already know where cuts can be made within this but don't want us to confirm it for you.

silverwhistle

Internet and mobile seem expensive. You don't _need_ to pay anything for TV (apart from the licence) and you'd be better off buying a sim-free phone and using one of the providers like giff gaff. Obviously you'll have to wait until contracts expire. International calls - when I was living away from family - was via Skype, even to mid-eighties parent.

Groceries has a fair bit of slack too, and even if you can't manage £1 for a lunch everyday, if you can do it twice a week it adds up over the year: you're looking for incremental solutions, not a magic bullet.

Clothes, cosmetics; there's normally slack there and my own budget for clothes is £30 a month at the moment - I'm still wondering where I should allocate the cost of my latest football boots! I'm not _completely_ butch so my cosmetics tend to come out of groceries, as I don't buy much. :-) I appreciate you may need a certain standard for work, but not keeping up with the Joneses saves an awful lot!

grumbler

£500 is a lot.
Use it to pay the CC off ASAP and you'll be £100 p.m. better off.

IMHO mobile insurance is a waste of money for the majority of people that don't have their mobiles lost/stolen/damaged every year.

£25 for mobile? This depends on your usage. 150+200+500 cost £0. If you can survive with this, is your phone really worth 24*25=£600?

£60 for Internet, TV, home phone, intl calls £60? This depends on the TV and intl calls. Is it really worth paying ~£30 for this? Most international calls cost peanuts nowadays.

Why content insurance only if you owe the house/flat?

marathonic

silverwhistle wrote: »

You don't _need_ to pay anything for TV (apart from the licence)

I'm building my emergency fund at the moment and have cut all expenses significantly. Regarding TV, I've cut that completely, including the licence.

You don't need a TV licence if you don't watch TV as it is being broadcast. This means that you can watch BBC iPlayer on your TV and not require a licence. I can well afford to pay for TV but why bother when I can watch enough programmes for free.

Hominu

litespend wrote: »

Thanks, but I'm not really sure how I could eat a healthy lunch for £1 even if I cook it from scratch?

It costs me £10 per week for my work lunches, and this does 5 days, so £2.00 per day. Mainly consists of lettuce, cucumber, tomatos, peppers, and some kind of meat, mostly ham. Throw it all into a box, stir it up and eat. Also includes an apple for an afternoon snack.

silverwhistle

marathonic wrote: »

I can well afford to pay for TV but why bother when I can watch enough programmes for free.

I know, thanks!:-) Haven't got a licence or even a TV to watch on, though if I were that bothered I could use my old laptop.

getmore4less

If your debt is going up you have missed stuff.

Do a spend diary and find out where all the money goes.

2 year contracts when did you start these, when will they end.

Drop the phone insurance what else do you get on the account probably can drop the pay account completely.

Check out OVIVO for almost free mobile(£20 up front then free)


Why website hosting? what personal stuff do you host? if business it should not be here.

joncombe

litespend wrote: »

website hosting: £5

It's only a small amount but this seems an obvious cut unless this is a business site that is making you money?