Difference between necessity and luxury?

HealthandWealth

Hi, I've been really irresponsible and gotten myself into an awful financial situation. It's down to falling pregnant earlier than planned and my partners unexpected job loss, but I know it was my responsibility to plan and be prepared for these types of situations so I'll not make excuses.

I'm currently claiming Universal credit whilst me and my partner both look for new jobs, and we've defaulted on our debt repayments (totalling £7k). I'm on a DMP but I'd really like to start throwing every spare penny I can at my debts, but I'm having real trouble distinguishing what's a necessity and what's a luxury, so thought I'd post to see what people think.

We've just moved house and have no oven, no bedroom carpet, no decor or furnishings (lampshades etc). Our babies room has no curtains/blinds up, no toy storage, no nightlight. I don't get my haircut and don't have many clothes, as most of them are either too small for me now or had holes in from wearing them so much. We only have one pair of shoes each and my partners down to his last 2 pairs of socks.

I panic about buying these things as I feel we need to save all our money to put towards debt, but then if we have money left in the bank, my partner feels it MUST be spent so goes and fritters it away on tat and food anyway.  So I've decided to pay debt off at the start of the month, but I'm dithering because I don't know whether I should do the house up a bit and buy some clothes first?

Any opinions on which category the above falls into would be really helpful. I would love an emergency fund, but I know that I'd feel too guilty to keep it hidden from my partner for long. I'll post an SOA in the next post,
Thanks

HealthandWealth

[font=courier new][b]Statement of Affairs and Personal Balance Sheet[/b][b]

Household Information[/b]

Number of adults in household........... 2

Number of children in household......... 1

Number of cars owned.................... [b]

Monthly Income Details[/b]

Monthly income after tax................ 0

Partners monthly income after tax....... 0

Benefits................................ 1560

Other income............................ 0[b]

Total monthly income.................... 1560[/b][b]

Monthly Expense Details[/b]

Mortgage................................ 0

Secured/HP loan repayments.............. 0

Rent.................................... 450

Management charge (leasehold property).. 0

Council tax............................. 20

Electricity............................. 28

Gas..................................... 28

Oil..................................... 0

Water rates............................. 60

Telephone (land line)................... 0

Mobile phone............................ 20

TV Licence.............................. 0

Satellite/Cable TV...................... 0

Internet Services....................... 45

Groceries etc. ......................... 240

Clothing................................ 0

Petrol/diesel........................... 0

Road tax................................ 0

Car Insurance........................... 0

Car maintenance (including MOT)......... 0

Car parking............................. 0

Other travel............................ 0

Childcare/nursery....................... 0

Other child related expenses............ 0

Medical (prescriptions, dentist etc).... 0

Pet insurance/vet bills................. 0

Buildings insurance..................... 0

Contents insurance...................... 0

Life assurance ......................... 0

Other insurance......................... 0

Presents (birthday, christmas etc)...... 0

Haircuts................................ 0

Entertainment........................... 150

Holiday................................. 0

Emergency fund.......................... 0[b]

Total monthly expenses.................. 1041[/b]

[b]

Assets[/b]

Cash.................................... 0

House value (Gross)..................... 0

Shares and bonds........................ 0

Car(s).................................. 0

Other assets............................ 0[b]

Total Assets............................ 0[/b]

[b]

No Secured nor Hire Purchase Debts[/b]

[b]Unsecured Debts[/b]

Description....................Debt......Monthly...APR

Storecard......................780.......5.........0

Storecard......................900.......5.........0

Credit card....................600.......5.........0

Overdraft......................2000......5.........0

Loan...........................3000......5.........0

Old internet...................150.......5.........0

Old phone contract.............295.......5.........0

Storecard......................75........5.........0[b]

Total unsecured debts..........7800......40........-  [/b]

[b]

Monthly Budget Summary[/b]

Total monthly income.................... 1,560

Expenses (including HP & secured debts). 1,041

Available for debt repayments........... 519

Monthly UNsecured debt repayments....... 40[b]

Amount left after debt repayments....... 479[/b]

[b]Personal Balance Sheet Summary[/b]

Total assets (things you own)........... 0

Total HP & Secured debt................. -0

Total Unsecured debt.................... -7,800[b]

Net Assets.............................. -7,800[/b]

[i]Created using the SOA calculator at stoozing. 

Reproduced on Moneysavingexpert with permission, using other browser.[/i][/font]


I'm tied into the high internet bill, and the £150 is £100 to my partner to buy what he wants, and £50 for clothes/toys for the baby.

I went through the last 3 Months bank statements and there was around £350 a month spent between takeaways and the local shop (my partner goes most days and comes back with several cans of pop for himself, aswell as snacks). The rest was on things for the house such as curtain poles.

Willing2Learn

Hi HealthandWealth and welcome to the forum 


You and your OH need to be singing from the same hymn-sheet if things are to move forward.


When you do your SOA, please complete the online form as a couple.  It makes it easier to see how much you have available each month for your contractual obligations, bills, expenses & debt repayments.  Please include everything in your SOA, including expenses that you may consider to be a luxury.  That way, we can put together a realistic plan. 

How old is the little one?

HealthandWealth

Thank you 

I've added all income and expenses to my SOA, except the shop spends as I don't know which category to list them under, and the house accessories as we have just moved and I have no idea how much to spend on these per month.

Little one is now nearly 2.

EimearF

These are neccessities:
We've just moved house and have no oven, no bedroom carpet, no decor or furnishings (lampshades etc). Our babies room has no curtains/blinds up, no toy storage, no nightlight. I don't get my haircut and don't have many clothes, as most of them are either too small for me now or had holes in from wearing them so much. We only have one pair of shoes each and my partners down to his last 2 pairs of socks.

£150 for entertainment - probably not. 

You need life insurance, content insurance and an emergency fun of minimum £1k 

Once you get the emergencies (purchase the above and £1K in savings)  sorted you can start to look at a plan for making larger debt payment but use this time to get yourself sorted. You can buy second hand or very basic things to save money but the things you listed are necessities. 

CreditCardJunkie

Have you tried the extra income forum? I'm currently on statutory maternity pay and have been paying off my debts, by learning to live within my budget and getting some extra income doing mystery shopping, surveys etc.
Definitely get second hand what you can ie lampshades etc. 

[Deleted User]

If £100 of the entertainment budget is spending money for your partner why is he then going out and spending more on several cans of pop and snacks at the shop?  Neither of you is working right now so you have all day to make your own meals rather than spending money on take aways. I appreciate that you don't have a cooker but it is still doable.  

You really need to sit down with your partner and go through your budget together.  Furnishing your home can be done on the cheap although this will be easier when lockdown is over or at least eased up a bit.  Charity shops and Gumtree are good sources for all kinds of things.  A free standing electric cooker you can buy brand new for less that £350 if you can't find a second hand one. For carpets keep an eye out for off-cuts. There's no denying that money is tight but it is possible if you work together, set some goals and don't fritter money away.

Galloglass

For items like cookers, curtains and some furniture, see if there is a local charity that will give a small grant of a few hundred pounds. It is surprising how many small local charities there are which were set up decades ago and which still have funds. 

Check Turn2Us grants checker or check with local council if they know of any. 

[Deleted User]

HealthandWealth said:

Hi, I've been really irresponsible and gotten myself into an awful financial situation. It's down to falling pregnant earlier than planned and my partners unexpected job loss, but I know it was my responsibility to plan and be prepared for these types of situations so I'll not make excuses.

I'm currently claiming Universal credit whilst me and my partner both look for new jobs, and we've defaulted on our debt repayments (totalling £7k). I'm on a DMP but I'd really like to start throwing every spare penny I can at my debts, but I'm having real trouble distinguishing what's a necessity and what's a luxury, so thought I'd post to see what people think.

We've just moved house and have no oven, no bedroom carpet, no decor or furnishings (lampshades etc). Our babies room has no curtains/blinds up, no toy storage, no nightlight. I don't get my haircut and don't have many clothes, as most of them are either too small for me now or had holes in from wearing them so much. We only have one pair of shoes each and my partners down to his last 2 pairs of socks.

I panic about buying these things as I feel we need to save all our money to put towards debt, but then if we have money left in the bank, my partner feels it MUST be spent so goes and fritters it away on tat and food anyway.  So I've decided to pay debt off at the start of the month, but I'm dithering because I don't know whether I should do the house up a bit and buy some clothes first?

Any opinions on which category the above falls into would be really helpful. I would love an emergency fund, but I know that I'd feel too guilty to keep it hidden from my partner for long. I'll post an SOA in the next post,
Thanks

Hi and welcome   

It is sooooooo nice to hear someone taking responsibility for their actions - enormous respect to you.

I have highlighted in bold the points that i'm responding to and, in order, i'll add my thoughts; just a note though, i'm not old but I do have 'old school' views, i'm not judgemental but I do give constructive criticism. 

Necessity v luxury: one you can quite easily live without and it doesn't cause you any hardship - the other you cannot live without because you will physically suffer. 

Oven: you can live without this for a while - microwave initially, ask around friends and acquaintancies for a used oven meanwhile.  A new one can be sought further down the line.
Bedroom carpet: any carpet will always be dear - consider a few inexpensive rugs instead, B&M, The Range etc etc. sell budget rugs, in a few years you can go down the new fitted carpets road; it's not just the carpet, it's the underlay, the gripper rods, the fitters, and the removal of the old one. 

Blinds and curtains:  also dear - consider just one of those options, price up from the above shops. 

Saving is the right logic here but your partner is letting you down, he's depriving you and your child of the carpet, the oven, and all those other things, not clever and rather selfish, might be an idea to leave buying his clothes until next year and see how his thought pattern is then. 

Doing the house up v new clothes: you don't need to 'do the house up', that can come further down the road, you don't need a new wardrobe of clothes; get those few homewares and make do with the few bits of clothing, buy just a couple of 'small' items and make do with the outer ones, buying just 1 item at a time.

When you live a simple and quiet life you may just enjoy being frugal; your partner, not so much, he'll probably hate it.

As I said, just my views.
Read what we're all saying, think it over, and make some plans - written plans allow you to continually check what you're doing - I love plans and lists …..  

ditty1234

Hi even in a normal budget you would need money for clothes and bits for your kid, and while you need things like socks and curtains, it does all add up terribly. While you are at home you can probably just buy the cheapest of clothes or buy used on ebay or fb. The problem is that charity shops are closed. You should be able to get a cooker/oven and I think that would save you a lot of money! 
Buy things that will give you a lot of mileage ... comfy walking shoes so you can go for walks with your baby. I bought a clipper and now clip my boys hair - I even do fades. You can make curtains from sale duve covers with a bit of tweaking. 
But I think make lists of everything, write down everything that you spend, pay a minimum on your debt until your income comes back up, drive down the price on everything you buy, food, decor, baby stuff you can do it. Be creative.
And as mentioned above you absolutely need to have an emergency fund before you focus on paying your debt. Ideally 1k as you have a baby and you never know. Get your partner onboard!
Adding ... with a nice rug is essential, my ds bought him selv a nice shaggy rug online for about a £10, it is also quite easy to make roman blinds with some string and sticks, I'm not joking go diy and then when you can afford it you can do up your house to a higher standard, stay on this forum, explore the different threads and keep getting ideas.  

enthusiasticsaver

£150 on entertainment is a luxury and not a necessity especially if you are on benefits. 
I would say an oven is a necessity.  Can you get one second hand or on freecycle? 
You can get second hand clothes on ebay for you and your baby.  
An emergency fund is a necessity but rugs, lampshades etc are luxuries.  You can get those from freecycle or buy as cheap as possible. 

Your partner spending every spare penny you have is your biggest problem.  If this is his attitude hiding money in savings or overpaying debt at the beginning of the month is better.  Work on that with him or this will affect your finances your whole life.