Over budget :(

FireWyrm

jocat15 wrote: »

It does feel about right.

There is no 'feel' about it. Either it is, or it is not. If you are spending more than you 'think', then your budget is wildly inaccurate and useless for the purposes of planning. The key to successful budgeting is KNOWING for sure that this is the cost you pay for the commodity you are buying.

I advise that your very first step starting on the 1st August is to make a budget and stick to it. You cannot make meaningful plans or decisions based on what you 'think' might be happening.

You have probably seen the term 'YNAB' bandied about. This is software to help you budget and it really works. I know it costs money (currently around £30 unless you can get one of the periodic flash sales on steam for £7) but I guarantee it will be the very best use of £30 you will ever make. Go to https://www.youneedabudget.com and download the trial. If you can make it work and I highly recommend that you make it your business to get it to work, you will not only make your money back from the original purchase, but you will be well on the way to a brighter and less stressful future. It wont make any more money appear out of thin air, but it will damn soon ENSURE you are making the very best of what you do have.

jocat15 wrote: »

I am not able to make the full payments on the credit cards, I should be paying approximately £250/month but am only able to make payments of about £100, so I am falling behind with those. In total they amount to about £6600 over two cards.

Why are you falling behind? You need to get to the bottom of this right now. Is it because you are continuing to spend on them, or because you are frittering what resources you do have elsewhere and therefore cannot make the payments? Getting charged late fees on credit cards is a stupid waste of resources and I suggest you make sure it stops, from this month going forwards. The way to do that is to get a budget that you know works, is stable and you are sure is making the best use of the money you do have.

jocat15 wrote: »

The house phone, mobile phones, broadband and cable TV amount to £150/month so I did somehow manage to double them up on the plan - apologies.

So what is your revised 'budget' now then?

jocat15 wrote: »

The gas and elec is the cheapest I can get, that has been reduced from £80/month each. Water is metered.

Then you need to take steps to reduce your consumption. There are many ways to achieve this, but like budgeting, you cannot fix what you cannot see. Your next purchase should be an inexpensive electricity meter gadget from Amazon which clips to the main cable and gives you an idea of how much you are spending by the hour. Once you have that information, you will be able to see what is left on, what is consuming power and where you need to economise.

jocat15 wrote: »

I am also desperately looking for additional work and part time work to supplement the income although that won't make much difference as the benefits will drop in line with additional earnings.

Make your money go further first, then worry about increasing it - unless something lands right in your lap next week, it is wasted effort right now unless you get a handle on how you are using what resources you have on hand.

jocat15

Thanks peeps, I will look into all ideas mentioned.

Partner is also looking for work but with the DR10 on his license that is proving tricky.

ViolaLass

jocat15 wrote: »

Thanks peeps, I will look into all ideas mentioned.

Partner is also looking for work but with the DR10 on his license that is proving tricky.

Can/is he getting benefits in the mean time?

Can he sell the car and buy a bike/scooter instead? Would save you a lot of money.

Is he on board with the money situation?

jocat15

He is not entitled to any benefits as i work self employed for more than 25 hours a week. He does discos occasionally so needs the car to transport his equipment.

He knows about the money situation and does what he can when he can.

jocat15

I've redone the budget to account for the doubling up of phone and internet etc. Whilst doing this I realised the benefits were wrong so I have amended this too.

Statement of Affairs and Personal Balance Sheet

Monthly Income Details
Income from Employment (after tax). . . . . . . . . . . . . . . . . . . . . . . 0.00
Income from Self Employment (before tax). . . . . . . . . . . . . . . . . . . . 666.67
Benefits (Inc. Child Benefit/Tax Credits & Income Support). . . . . . . . . . . 1,040

Monthly Expense Details

In Your Home

Mobile phones . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 80.00
TV licence. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 12.00
Internet. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 20.00
Home phone. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 25.00
Cleaning products/Cleaner . . . . . . . . . . . . . . . . . . . . . . . . . . . 10.00
Electricity . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 65.00
Gas . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 65.00
Water . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 50.00
Council tax . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 33.00
Mortgage/Rent . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 650.00
Food and household shopping . . . . . . . . . . . . . . . . . . . . . . . . . . 200.00


Motoring & Public Transport

Petrol/Diesel . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 60.00
Car tax . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 20.00
Car insurance . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 100.00
Car maintenance . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 40.00
Breakdown cover . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 20.00

Debt Repayments

Credit card repayments. . . . . . . . . . . . . . . . . . . . . . . . . . . . . 250.00


Family

School trips. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 20.00
Laundry/Dry cleaning. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 10.00


Entertainment

Satellite/Digital TV. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 25.00

Big days out. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 20.00

Hobbies . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 40.00


Clothes, Health & Beauty

New children's clothes. . . . . . . . . . . . . . . . . . . . . . . . . . . . . 10.00


Big One-Offs


Birthdays . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1.67

Summer holiday. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1.67
Christmas . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1.67

Odds & Sods

Tax & NI Provisions (self-employed only). . . . . . . . . . . . . . . . . . . . 23.33



Total monthly income. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1,706.67


Total monthly expenses. . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1,830.01

FireWyrm

I suggest you get rid of these three for a start - that's £85 right there. You cant buy something if you dont have the money for it - sorry. TV is not necessary for life, there are alternatives. Your hobby is costing you £480 a year which is insane when you are struggling to feed and clothe your family.

Satellite/Digital TV. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 25.00

Big days out. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 20.00

Hobbies . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 40.00


Likewise, school trips and laundry(?) can go too, that's £30. So far, you have saved £115. You need £124 to break even. Add to that the TV license (now unnecessary without TV) and you are now breaking even.

Other advice is to look very very closely at your grocery budget. Not only dont I believe your figures, I think you are probably erring downward. I bet you actually spend much more than that. First job for next month therefore is to get a pen, some paper and analyse your previous spending from your bank statements. My guess is that you are losing huge amounts in 'ad-hoc' spending that you simply are not accounting for here. This is why you need a proper, to the penny budget and the sooner you start, the better.

Ditch the landline and pay line rental up front. You can get annual line rental for around £140 a year, especially if you play hardball with them - compare to £15.99 a month typically from Sky just to rent the line from BT. They are making a killing off you.

You need to plan to pay all your insurances annually going forwards. All insurances not only incur a 5% tax, the provider usually adds 34% premium for the privilege of paying monthly. Getting ahead of that will get you breathing room in the long run.

jocat15

I have set up the YNAB ready for the start of next months. Onwards and upwards from then on in.

Tixy

So on the new budget then £120 overspend is pretty similar to what you are not paying to the credit cards. So that looks realistic for what you have been spending.

So you need to see what you can cut out, but if with the various suggestions you cannot make changes so these balance then you will need to look at debt solutions. Once of the charities will advise on the options available to you and the implications of them.
Any debt solution will affect your credit file, but then if you have been missing payments to the cards it is likely already badly affected so probably isn't your main concern.
Its definitely worth a free phonecall to them for some advice, whatever you finally decide to do.

FireWyrm

jocat15 wrote: »

I have set up the YNAB ready for the start of next months. Onwards and upwards from then on in.

Atta girl. Now stick to it, religiously. I cannot stress enough how crucial on a tight budget it is to be a complete tight wad. You need to know exactly where every penny goes. It is no use sticking a finger in the air and guessing - it is a waste of time, I guarantee it.

Some people say they cannot get on with YNAB, they dont 'understand it', they hate numbers, they cant be bothered etc. If you can make it work and there is no reason why any decently educated, realatively smart adult cant, then you will simply ratchet yourself out of debt faster than you believe possible. I have paid off over £10,000 of debt in just over 6 months. I know I have a far higher income, but the principle is the same. Three years ago, I stood at the checkout with a belt full of food, 2 days after payday and watched by debit card get declined. Now, I have £2789.20 of cleared funds sitting in the bank as of right this minute. THAT is what I mean by knowing where every penny goes. That money is allocated of course, it isnt there to spend, but I am coming up to MOT/Insurance time again this year and I know for sure that I have the money. There is no playing guessing games, robbing Peter to pay Paul or flying of kites. I know.

P.S, once you get going with YNAB, you can do things like this :



From that information, I can forecast next month's spending. I know I need 6 blocks of butter, 16Kg of flour, 16L of milk etc. I can budget for them. I know I need them because I needed them for the last few months. No more running to the local co-op for milk (and incidentally, £30 of 'other' stuff I didnt know I needed until I walked in there...) because I have it - on hand, already bought.

Tixy

Firewyrm, what is this non-edible food you are buying? I prefer the edible type myself