How do you pay for things?

pinmoney

Hi - I was in a similar position when i "found" MSE. Our situation was that we had 2 credit cards, and current account and Home Services account that went into the red every single month. I decided that I had to take charge of the finances. First job was to pay off credit cards and get the HS account into the black each month. The best advice I found in MSE was to concentrate on the highest %age debt first, and pay the minimum on the rest. Then to juggle the direct debits between the current account and the HS account so at least the HS account went into the black fairly quickly. Key to this was to start using on-line banking and to regularly check what money was going out in direct debits and to start to get a feel for reality (rather than my imagination). It took a while to sort things out - but we now have 2 bank accounts in the black, and our debt is now considered rather than impulse. Everyone has different considerations - but i hope this might be helpful.

MagicLily

I have 2 Current accounts with 4 saving accounts linked. So a sort of envelope system.


When I get paid: Salary and maintenance, I transfer money to the Bill current A/C, xmas savings account, emergency fund, holiday fund and Kids fund.


My bill account has all my direct debits. It then leaves me a sum to spend (in my other current a/c) for food, fuel, and socialising, hair cut,etc This money I split by the weeks of the month. Then I make a mental note of how much I can spend each week. Sometimes I might take that cash amount out at the beginning of the week.


Things are tight while I'm paying off debt, but its working. Its also great when you get to xmas and you have a little fund there to spend.

AshfordSteve

My wife and I have a joint account which all our bills and household spending come out of, and we also each have separate accounts for our monthly allowance. All our spending is on debit card, with the odd exception such as the butchers or window cleaners who do not accept cards. I usually have some cash on me from my account and so will use this and then transfer money from the joint account so that everything is accounted for. I have a spreadsheet for all our spending which I update regularly - it was daily at first but as we've gotten better it is more like weekly now.

We also have a saving account for car insurance, professional fees, holidays and presents. This is all in one pot, but recorded separately on a spreadsheet. I would use a credit card to pay for a holiday, but only if we already had the money saved to pay it off when the statement came through.

We do not have an emergency savings pot, as I do not feel the need for one. Both our cars are newish and still covered under servicing plans and manufacturers warranty, our house is less than 10 years old so we are unlikely to have any issues there, and we are also lucky enough to have a lot of wriggle room in our budget - we are currently paying at least £700 a month over our minimum payments so we could divert this if we needed to. We also have a very straightforward family situation - both in secure employment and no children.

spiderx

Wife and I have a shared credit card with a £10,000 limit on...a left over from when we earned more years ago...and we buy just about everything on the card but paying back in full each month and obviously no interest.We get points for using it and don't pay any annual fee...would give it up if either of these things didn't apply. We are absolutely rigid about never paying any interest and I look at our credit card acc. several times a month to see what bill we are going to expect at the end of that month. Will cool the spending if we are getting a bit rash with it and it looks like we are heading for a large bill. Do feel a bit smug for getting points (i.e. vouchers) for paying things like council tax though !! Also getting points on Morrisons card and the credit card for filling up with petrol.

Wonderer91

I pay for everything with cash taking from a current account (except DD's), as I feel it is too easy to spend on debit card and this quickly adds up like how I use to spend but now I have a weekly budget in which I won' t take more out of the account for that specific purpose for example food.