In a muddle with money - need help!

japmis

I use the YNAB (You Need A Budget) software after I found spreadsheets were completely useless. The best bit is they have an app which means you can track money on the go; e.g. you can check what's left in your petrol pot before filling the tank This really curbs willy nilly spending (you can even have a pot called "willy nilly"!!)

sanfrancisco

Please don't sell. I see no gain from selling. You need to knuckle down and pay the debts where you are. If you don't know where every penny you are spending is going you have not had your lightbulb moment. You will not save and will never get ahead.

Meal plan
Sell everything
Rent a room
Walk everywhere
Everything second hand
Saturday job

You are actually in not a bad position. This time next year you could be debt free if you put your mind to it. You will feel empowered if you do this yourself and don't sell the flat.

Good luck.

lollipop14

Wow! What a lot of replies, thanks so much for all of your input!

Takeaway_Addict You've hit the nail on the head. Most of our money is wasted on food. We throw a lot of food in the bin, and also have take aways far too often. Our other extravagance is gifts for other people. I know that seems ridiculous, but we both have really big families and I get very wrapped up in "keeping up with the Jones'" when it comes to buying gifts. In general actually, I think I look round about me at people with similar jobs to us and think "they're doing X,Y and Z, so we should do that too" whether we can afford it or not.

Pepperoni I totally agree with you, going part-time is definitely not the smartest move for us. I've lost quite a lot of sleep over deciding on what to do, and have already applied for and been accepted to reduce my hours, and there's no going back on it. A lot of things will need to change, basically I think we both need to grow up a bit and start living within our means. I won't get this time back with my precious Emma, so will just need to make whatever sacrifices it takes to make this work.

Pickleme the answer to your question is a bit complex! Lol! We're not actually desparate to move. We love our flat and have 3 really big double bedrooms so space is not a major issue. It's all to do with our long-term plan really. Within 5-10 years we'd like to be in a house (currently 2 floors up which is a pain, flat is on 2 levels and babies room is on a different floor to ours, the kitchen and living room are effectively equivalent to a 1 bedroom smallish flat so not really ideal long term, we have nowhere for a kitchen/dining table which really bothers me as I think eating at a table as a family is really important, and we'd love a garden). We'd also really love to have a 2nd child, but I definitely don't really want that to happen whilst we're still in debt and absolutely don't want to be on maternity leave again without having saved for it. However, I'm almost 32 (not exactly ancient I know!), with going part time we should manage to reign in our spending and live within our means but we won't have masses of cash to throw at clearing our debt. There is 3 years left to run on our bank loan so I guess that's the maximum time it would take for us to clear our debt. The problem being that by that point I'd be almost 35, again I know it's not exactly ridiculously old, especially these days, to be having a baby, but I didn't get pregnant very easily so I'd be reluctant to wait that long to start trying. So basically!!! I feel that if we can sell the flat, we can take a break from the expenses of running a house for 6-12 months, clear our debts, get back on the property ladder and start to plan for baby number 2! Phew - bet you're glad you asked! Lol!

Bilbennet Our combined earnings are a little over £70k, so even with 4 months on mat pay, I don't think we'd be entitled to anything, I have had a tax rebate which just covers my pension contributions. I'll look into it though.

Yorkshirelass thanks, if nothing else it's good to know we're not the only people who have gotten ourselves into this position. Thanks for the luck!

Enthusiasticsaver I live in Scotland and the system here is different. The seller of a property pays for a home report, which is the money I was asking about putting on a credit card. I wouldn't be intending to buy another property until our debts were cleared. We'd get on fine at my mums, although not ideal, we've done it before for 18 months and got on great. We moved in with her just before we were married, we cleared £6k from a credit card, saved £22k to pay for our wedding and used the equity from a flat my now husband sold, as a deposit for the flat we're in currently.

Japmis thanks for the tip, I'll look into that now. I do also find that spreadsheets are totally useless!

Sanfrancisco you make a few good points, which we need to take on board whether we sell or not. Meal planning is a biggie for us to get better at, I could certainly walk a lot more (which would help my waist line too!). I'm not keen on getting a Saturday job as my hubby works shifts so that would mean childcare issues, but I can tutor and apply to be an exam marker as an alternative so I need to look into that. Our living area really is tiny in the flat, and we're not keen on a lodger, but if we get desperate we could reconsider!

Ok, sorry for such a mammoth post, but I thought it was only fair to answer all of you lovely people who took the time to comment. I'll be back just shortly with where I think I'm going wrong, a couple of questions and my current plan of action...........

lollipop14

Where we're going wrong:

Our "budget" has really been a token gesture for the last couple of years, and in no way covers all of our spending.
We waste a ridiculous amount of money on food and take aways.
I get too caught up in keeping up with what other people spend on gifts and need to be better at only spending what we can afford.
We're too impulsive with booking holidays, and always intend to pay for it after the event.
We moved banks in October 2012 but I never actually activated my debit card for our new joint account, where our wages go in and bills go out. So I still spend from my old account, which has an overdraft, which I spend most months, so start every month bringing that account back to zero before starting our budget, meaning we always start off on a back foot!

Plan:
We have been accepted for a credit card which does 0% cash advances for 23 months, so I am transferring both credit cards and overdrafts onto that card as soon as the funds come through tomorrow.
Cancel our existing credit cards.
Activate my Santander debit card, and close my First Direct account.
Budget for food and lift that money in cash (this worked for us when I was a student).
Apply to do some "keeping in touch days" at work which I'll be paid for.
Apply to become an exam marker.
Sell as many things as possible which we have no need for.
Alter our budget to include things we pay once a year.
Get some Estate Agents out to get a valuation for our flat and to find out exactly how much a home report would be.
Raise funds for home report by doing keeping in touch days and selling things.
Prioritise reducing the electricity bill. Increase our monthly DD, but also put any "spare" cash in the month towards that first.

Questions:
Pickleme you mentioned that 1 off things you pay for, such as car tax should still be included in our monthly budget, should I actually siphon that money every month into a separate account so it's then available when it's due?

How much is realistic to budget for food for 2 adults and a soon to be weaned wee person? I'm thinking £210 to include toiletries and cleaning materials.

Thanks in advance - and thanks for reading if you've got this far! ;P

andyfromotley

Another vote for YNAB here too.

It may revolutionise the way you handle and think about money. It has for me, literally within weeks.

dancingfairy

If you take your monthly income minus your monthly expenses and debt repayments it's looking like you have about 250 a month spare I think (for some reason the bottom bit of your SOA has not come out which would tell you this).
I think if you actually put realistic monthly amounts in for all the things you buy yearly and for food you would soon find that that 'spare' money does not exist.
If you have a look back through bank statements you may be able to identify where the money has gone, but the best way is to do a spending diary. If you do that for a few days or a week you'll probably do this :eek: and you will see how much money you spend/waste without even thinking about it. When you see where you are wasting money you can see where to cut back.
df

pleasedelete

Pepperoni I totally agree with you, going part-time is definitely not the smartest move for us. I've lost quite a lot of sleep over deciding on what to do, and have already applied for and been accepted to reduce my hours, and there's no going back on it. A lot of things will need to change, basically I think we both need to grow up a bit and start living within our means. I won't get this time back with my precious Emma, so will just need to make whatever sacrifices it takes to make this work.


Get HR advice. It probably isnt too late as you havent returned. If you are planning a 2nd child then go back full time- have another and another maternity and then reduce hours. Most teachers play the system.

lollipop14

I'm so annoyed! I did 4 days in work this month to try boost my maternity pay a wee bit, but I haven't been paid for them! I filled out their forms and sent them in, I emailed them to confirm what the forms said, and my boss emailed them too. The council I work for are such a joke!!! Gggggrrrr!