Calculating disposable income

chaplin80

Hi,

I am trying to get a clearer picture of our finances so that I can work out exactly how much 'spare' money we have each month that can go towards our debts. I have added up all of our compulsory bills - mortgage, gas, electric etc and I have also included all of our minimum debt payments which are around £1100 per month and insurances.

This leaves us with around £1830 per month. We will need to buy spend some of this on food and I estimate this to be around £350 a month ( fuel is £150).

If we do have £1500 left over, how much would you apportion to the debt and how much would you allow yourself for 'spending' money? I am horrified to see just how wasteful we have been however I am also reassured to see that we could potentially knock 2K a month of our debts

yasmin2

I think I would apportion the majority of the money to debt and then an emergency fund and skim spending money to the minimum. Also what do you mean by spending money? What's it for? What insurance are you paying? Is it necessary?

I have done a spreadsheet where I allocate money to bills coming up during the next year ie a tax payment is due in july. So have allocated £x per month so come July it doesn't hit me and have me fumbling around looking for the money.

Why don't you post up a SOA so people can help save you money even further.. Good luck

chaplin80

Hi Yasmin, I have already posted my SOA in a previous post. I have some fairly hefty cut backs - getting rid of sky subscription etc so I think I am not down to 'bare bones'. I definitely agree that I need to build up an emergency fund so that I am not relying on debt if something goes wrong

Helvetica_Van_Buren

The best way to do this is to track it for a month.

Start now: write down every penny you spend from today and on what. By the end of April you'll have three weeks' worth of data to work from. It'll also make you far more conscious of your spending and I reckon you'll see improvements straight away.

Then, write your budget for May and try to cut back on all the incidental spends you made in April.

Brightspark87

Hi just to add - paying in cash may help you to keep on top of this however, I found it easier to keep an eye on using my card I could see the spending and monitor online. You'll get there.