DrSpendingLittle's New Home - staying accountable and responsible

dizzydonkey2

Ctrl & home will take you back up to the top quickly

DrSpendingLittle

Ooooh - I'm a Mac user and google tells me it's Command and Up.  Thanks @dizzydonkey2  🙌 🙌

Star_Mummy_2

Hi DrS

I've just found your new diary and had a little catch up.
You've done amazing on the savings totals this month.
I'm sorry the house sale fell through..but it opens up the doors for something better

I think I may follow in your footsteps and start a new diary on the new forum. I'll wait until I start my new job next month so I can adjust to what my take home pay will be and the change in pay date (end of month to mud month). It feels like a new life chapter so a new diary feels appropriate. I am sure it's the same for you now the debt has gone?

DrSpendingLittle

Wow, long time no log on! All's well here. I'll do a proper update over the weekend. Nothing major to report but I want to get back into the swing of good money practices, so I intend to start coming back on here. I've a fully funded EF and I've maxed out two current accounts to the upper limit for balances paying 2% interest. I now need to look at alternative savings options. That's the plan for the weekend. I still have YNAB but haven't used it since the new year. I intend to start using it again from 1st September and have done my budgets through to Jan 2021. 

We're still living where we were the last time I logged in. We're probably going to delay a second attempt to move house until 2021. We've some minor building work planned in October. 

We've both been working from home since March. We're the lucky white collar workers who have been able to continue working as normal during lockdown and therefore have been save on commuting / discretionary spending costs. I've been thinking lots about how I can contribute to help those in a less fortunate position. That's part of this weekend's financial makeover. Life is so polarised and unfair at the moment. 

Back soon xx

DrSpendingLittle

Okay, a quick update on my progress so far:

• My first current account pays 1% on balances up to £4K and 2% on balances between £4K and £5K. I tend to maintain a balance of around £5K in there to take advantage of the interest. 
• My second current account offers the same deal, so my emergency fund is in it. I have two direct debits set up in this account and I transfer £1K each month back and forth between the current accounts to qualify for the interest. 
• I've opened a new monthly saver with my main bank. I have a standing order to deposit the maximum allowed each month (roughly 10% of my net pay). It offers 1% on balances for 12 months fixed, with interest payable at the end of the term. It then reverts to a carp interest rate but I can 'convert' it at the end of the term. 
• I've opened an easy access cash ISA with my second bank, with a shockingly low interest rate but its better than nothing! This will be the place where my 'overflow' savings go - the ££s that can't go into my monthly saver but that won't be earning interest in either of my current accounts. This amount will vary monthly depending on spends and I've given it a line item in my YNAB called 'To be Budgeted'. I'll siphon any ££s above £5K from my first current account into this ISA the night before payday. This will likely include ££s set aside in my YNAB pots for yearly expenses (car insurance etc). As long as I keep on top of my YNAB pots, I'll know where each £ is and why it's there. Hopefully  

I did consider a S&S ISA or a better yielding savings account but I don't want to lock my savings away for a fixed term or it be at risk. I want all my savings to be easily accessible so I have maximum financial flexibility until we move house. Once I'm more settled and have more of a cushion, I'll consider some better yielding 'investment' style options.
 
I also wondered about opening another savings / current account with a new bank, but I'm not sure I want the mark on my credit record and it seems a bit unnecessary to be banking with more than two banks. Especially with interest rates being so poor. 

That's it for now! I had a NSD yesterday (if you don't include transferring money in-between all the above accounts) and today too. I intend to have one tomorrow but we might stop off for a beer after doing sport. 

DrSpendingLittle

A few more quick updates before I get on with the day:

• I've opened an NS&I direct saver account that yields 1%, which is much more generous than the cash ISA I have, so I'll put my overflow savings into that from now on and revisit in a year.  
• I've been inspired by @HairyHandofDartmoor and have purchased £100 of premium bonds! I intend to buy bonds with any cash gifts I get (MIL gives me cheques for birthdays and Christmas and I'm always at odds with what to do with it), as well as cashback and bank interest - all the random bits of ££s that appear on an ad hoc basis throughout the year!. Any wins I've directed to be reinvested. There wont ever be much ££s in there, but its a bit of fun! 
• I've arranged a monthly cash donation to my local food bank, which will provide some financial support for their day to day running costs. I think this will be more helpful in the long run as they seem to have sufficient quantities of food. A lot of shops in my local town have donation bins, including all the supermarkets, so actually they tend to be well supported food wise. It's easy to put a few bits in your trolley at the supermarket and place them in the donation bin on the way out, which is what I tended to do previously.  But I wanted my donation to be something more regular and guaranteed for them.

On the subject of my emergency fund, I have 4 months of (not bare bones) everyday expenses saved, which equates to about 2.5 monthly take home pays. If I did a bare bones budget, I reckon I could keep going for about 6-7 months. If I were made redundant (always possible but not very likely in my industry, touch wood! ), then I'd be entitled to about £4.8K in statutory redundancy pay, which would tide me over even longer. However, my company would very likely offer me quite a generous voluntary severance package before any compulsory redundancies happened, which would probably equate to a months salary for each year of service, so if that did happen, I'd be comfortable for a couple of years, even longer on a bare bones budget. I'm tempted to top my EF up to three full monthly take home pays, just for a round number. I don't like 2.5! It seems unfinished! I don't have critical illness / mortgage protection cover (DF does though). Our mortgage is tiny compared to our take home pay, so we could survive comfortably as a household on just DF's salary. However, I intend to get it when we move. I'd be entitled to 6 months full pay and 6 months half pay if I were sick or in an accident, so that gives me more breathing space if the worst did happen. 

So, now the EF is fully funded, I need to plan what I am actually saving for. I don't want to just aimlessly save. First port of call is moving expenses. I'd saved them up last year but decided to spend them on building work when our sale fell through. And a new desktop and phone handset That'll be about £3K for my contribution (split with DF). Then I guess there will be the set up costs when we do eventually move - painting, decorating, gardening, new furniture etc I'd guess around £5K for my contribution (£10K overall)??. On the personal front, I have a few pieces I want to add to my winter wardrobe that I'm budgeting around £500 for, though it's a random number at present! I budget £150 monthly for clothes and accessories already. Beyond that, we do need to think about a new 'family' vehicle at some point. I'm loathed to do what Dave Ramsey suggests and pay for it in cash, but at the same time, I don't want any debt. I'm debt free and proud! I guess it depends on how much we want to spend. Maybe £15K in total? So £7.5K each, possibly a little less with trade in. We will certainly be buying used (2-3 years) to avoid depreciation. Maybe we can save up and then 'borrow' from our savings and arrange a standing order that mimics a car payment? There is certainly no rush at the moment with working from home. In fact, having two cars sat doing nothing has become a bit of a nuisance, as I'm sure those who have them know! I will keep my little commuter car whatever happens, as it's dead cheap to run and I've driven every mile so I know its been well maintained and looked after. We've got used to the convenience of having two cars so it makes no sense to get rid of it for the sake of it.  

That's it for now! I'll put some more thought into my savings pots and be back soon! xx

enthusiasticsaver

Nice to see you posting again and glad that you are not among the unlucky people who are jobless at the moment.  Like you I feel a bit guilty at how little we have been affected and luckily our daughters and son in law have been able to work from home  and are white collar so unlikely to be made redundant.  Well done on food bank donation.  I donate food in our local Waitrose but never think of cash. We are retired on DB pensions so our income has not been affected at all and our savings have grown due to cancelled holidays and less eating out, trips away etc and no fuel.  Even our investments have recovered from the dip in March. 

Good that you have a fully funded EF.  We never used to save without a reason so I agree a moving house fund could be your next mission and replacement car fund.  We still have 2 cars but I have been using my e bike loads over lockdown.  DH and I still enjoy separate hobbies though so having 2 cars gives us both independence. Anything local I use the bike if the weather is dry. 

DrSpendingLittle

Its payday! 

It's been quite an interesting month money-wise. We had some building work done, some of which was a bit more expensive that we'd anticipated, so my savings goals for this month didn't quite go to plan and I had to take £290 out of savings to cover the bill. However, I have now rejigged all my savings accounts and sorted my savings plan up to January. I have a sense of what I am saving for in the short term, but I still need to think through medium to long term goals. I was annoyed to hear that NS&I are reducing their interest rates, as I'd factored that into my plans, but such is life and aside from locking away the money (which I don't want to do) I don't really have any other options for decent interest rates on easy access savings accounts. 

I've been a bit indulgent with the food shop this month and need to scale back the spending. I also treated myself to a hand car wash the other week. They were so busy and so unorganised that they ended up washing my car three times   It looks super clean and shiny now! I was sat in it for about 10 minutes, waiting and waiting, which gave me plenty of time to clean the inside windows and dash!

I managed to get everything off my autumn clothing purchase wish list and feel like I've had a 'proper good shop', so to speak! All budgeted for. Speaking of clothes, I got a text yesterday from my bank telling me I'd paid too much interest about 8 years ago on my student overdraft account and that I was due a refund of just under £50! Well, it arrived in my bank account this morning, which was a nice little surprise. So I've used it to order some new jeans, as my most worn / favourite ones are looking a bit scruffy and faded. As my 'proper good shop' involved jumpers / tees / ankle boots, I had budgeted to buy some jeans this month, so perhaps I'll pick up a couple of pairs if I like the fit. 

What else? Nothing much to report really on the finances front. I have renewed my YNAB subscription - I'm grandfathered under the old plan so its only about £40 per year, which I think it well worth the investment for how it helps me manage and visualise my finances.  We're both still working from home, so whilst our commuting costs have disappeared, we are spending more on electricity and heating. And food! And things to keep us occupied, like sports / training software & subscriptions and entertainment subscriptions. So, all in all, I wouldn't say we've been saving lots since lockdown, but we are content! 

I'll pop back once all the bills are paid and see what is left. I'm aiming to save about £650 this month, which is doable but I do think I'll have a little more building work to pay for in addition to what I've already budgeted. I might be able to bat it into November though. 

DSL 

enthusiasticsaver

Sounds like you are doing ok DSL.  Excellent news on interest refund and nice to have a splurge on clothes (budgeted of course). My DDs say the same about pros and cons of working at home.  Savings on commuting but more expense on lighting and heating especially now it is turning colder. 
The reduction in N, S and I rates has really ticked me off as I only moved into the income bonds last month after Marcus reduced its rates .  I have now thrown my toys out the pram, as my DH would say, and after our IFA appointment topped up our S and S ISAs and SIPPs and closed the N, S and I account.  Just kept our emergency savings pot and enough for our big holiday next year (should it go ahead) and our garden work in Yorkshire BS Internet saver.  Not too bad for us as we have DB pensions which cover our outgoings so our savings are just for extras but some pensioners rely on decent saving rates and there is very little out there now. A  cynical ploy by the government to keep us spending to avoid a recession I reckon and I will not go down that path.  Our investments returned 6.3% after fees and inflation this year so more will go there. 

DrSpendingLittle

Thanks @enthusiasticsaver ! Yes I'm really ticked off too. Sounds like your 'throwing the toys out of the pram' was a good thing! I wish I had enough saved to be in a position to 'risk' some of it in a S&S ISA but I just don't feel that comfortable at the moment doing that. I might open one next April, depending on how I feel. DF needs to sort out his savings as he is due to inherent some money and will have to move it out of his current bank. We want it accessible in case we move, so I had intended to open him an NS&I but not I'm rethinking that! Argh!