First Steps to Solvency

getmore4less

alt80 said:

@getmore4less think I probably need the discipline right now, structuring it more formally will probably help me not to get into the spending addict mindset.

Used to set aside Fridays for growth / business admin / strategy etc and should again. Used to have a few mentors in business all went by the wayside after things went downhill in my personal life. Your posts have made me see how much the personal issues have affected the business in terms of just coasting not growing so big thank you for that. Onwards and upwards all being well from now on.

The key is setting a budget, the plan of where you want your money to go. A lot find normalizing on annual give a better picture of how the distribution is working you could use an modified version to give a better picture of the leased cars maybe a 5year forward looking plan(detailed Y1 overview Y2-Y5) Now you have the the numbers for the F-type you have effectively removed £1,800pm from your outgoings you can see how stretched you were as you are still only just breaking even with other cutbacks. then consider there are 3 cars you can see how skewed your priorities have been, it will sort itself out now you are actually looking ta the numbers rather than going in blind. You pay people to do the day to day time consuming relatively easy bread and butter stuff to free your time up to do the thinking, seek out new business bringing that on line and doing the hard stuff etc. Time to resurrect the mentors and the network to look for the growth opportunities, I suspect you probably enjoy those meetings and thinking time just as much if not more than a spin in a metal box.

alt80 said:

@theoretica it’s just HMRC rate of £0.45/mile paid to my account in expenses each month on top of salary. 

I thought it was only the the 45p/25p allowance you could claim, £500pm of that as expenses is 16,000 business miles a year that's a lot if you want to keep this beast longer term and a massive cost subsidy from taxable income. I would seriously look at a cost benefit of moving your second car being a fully funded from pre tax income through the business. Using that for more of the business miles to give the RR a longer life, that is if the wife is allowed to drive the RR You could also review your car policies for those employees that need a car for work.

alt80

Something was nagging me about the car costs I posted up - just realised I worked the fuel out wrong for both forgot to X gallons by 4.54 to get litres... so calculated on £1.10/£1.20/£1.30 for a gallon, I wish haha. So RR fuel is currently £2,500 for 9k miles @ 18mpg and over the term £18,160 (wow lol) assuming petrol averages £1.20/l over the term.

Jag likewise I did the same thing so 10.5k miles @ 17mpg (super so £1.30/l for this) = £3650. 

Final costs for Jag with accurate petrol costs would be £53,350 so £5.08/mile or £1975/m.
Final costs for RR - £74,190 so £1.24/mile or £1500/m. 

That Jag was 100% not value for money. Had a laugh with it but not enough of a laugh for it to cost that tbf. 

alt80

@clairebeth tbh wife does do a lot - house always kept nice, cars valeted and polished once a week, garden immaculate she’s like some old man with her lawn and hedges haha, clean and ironed clothes and home cooked meals etc. I’m fairly lucky and probably have life fairly easy in some ways tbf. Your posts have made me realise I should appreciate her more. 

@getmore4less yes definitely time to move on with business and put some of the rubbish that’s happened in my personal life behind. If I don’t draw a line under the mess I’m not going to help myself move forwards. That’s not to say I’m proud of it but keep torturing myself about it isn’t going to help productivity/ growth either in business or personal. Need both and to stop being obsessed with the idea I need five figures/m income and start concentrating on improving what is already good. Maybe the income will follow, maybe it won’t but more to life than constantly thinking about spending.

Some of the business miles are done in the bmw but I’ve used to offset from RR in the calcs. Coming to the same conclusions re second car being funded from pretax income and just having RR on finance. I know it’s an extravagance. I do lease cars for staff so have an idea of what’s 0/low BIK tbf not explored the electric option yet for staff where cars are starting to come up for renewal. Tend to stick with lists made up of the smaller Audis, BMWs and JLR products. Being logical about it an ipace or similar would suit the type of miles I do (ie not much long distance). 

haha yes wife drives RR. It’s one of those cars as nice to be driven in as to drive tbf never had a problem with her driving any of my cars she’s a decent driver not the sort that wrecks wheels and parks by ear. 

enthusiasticsaver

Usually the income increases when you stop thinking about making money and focus on improving your business profitability.  Whilst  I don't want to hark on about the cars they are a draining asset.  Dave Ramsey (the financial guru) says as a rule of thumb no more than half annual income should be spent on a car.  So to buy a car worth £120k you should be earning £240k. LOL.  Not sure how he works that out but I thought it was interesting. 

You sound like you are doing really well on the no spends and spending more quality time as a family including going to PIL. Just watched the Coronavirus govt briefing and it looks like there are loads of local lockdowns up North presumably where you are. Hope you all stay healthy. 

strawb_shortcake

My parents always said they'd not spend more than their house cost on a car. Their house cost them £15k many years ago they've come close but never breached the limit, and I highly doubt they will going forward. 
I paid £107k for my house and though I suspect we will move I can't imagine being in a position to spend that much on a car not that I'd want to. But does make me wonder where car prices will go to in future. 

Appreciate this isn't really relevant to the thread 

ladyholly

Do I get the feeling that you are starting to respect your wife a little more now you are thinking about what she does for you and your son

clairebeth

Goodness! Your wife sounds amazing! Lucky you!

DayDreamerandGeneralWaster

Your wife sounds like a very successful wife and mother who really appreciates her home. Don't forget what they say about who is standing behind successful men. You couldn't do what you do without her beavering away in the background, taking care of all the stuff you never even have to think about.

alt80

Goals W/C 12th Oct

1. Spend less than £50 entertainment probably not going to be hard this week. £0
2. £10 groceries spend (have everything we need so should not be spending anymore than a few quid on milk or loaf of bread). £0
3. Check and update the Yolt app daily. Done
4. Structured work days - 9am starts 5.45pm finishes, emails off in evening. Lunch with wife. Eat dinner with family rather than wife cooking twice. Working from home all week (lockdown) apart from fee earners booked. Day 1 managed. Emails off too like being on holiday lol.
5. Train with wife 4x this week. Going to regret this I know haha. She’s already decided what we’re doing so no chance of backing out now. Day 1 survived. Actually really enjoyed it.
6. Activity with son everyday - probably going to be dog walk not going to be allowed to do much else... Dog walk in the rain.
7. Not punch the TV when Boris announcement happens tomorrow... OK that one is not real lol. Success. Didn’t even watch him so no danger of needing to buy another TV haha.

alt80

@enthusiasticsaver very true. I’ve had a bad mindset for more than a few years. Business just coasting along, personal spending out of all control, ‘not good enough’ demons worse than ever and generally just being too selfish. Hope this is a bit of a new start - getting the spending under control requires me changing my attitude to life tbh. 

Think it is a priority thing re cars but they were a bit too high on my list with the 3. Spent a bit of time looking into Dave Ramsey can’t deal with the religious stuff and I think he’s a clever guy making a lot of money selling his strategy to people - reminds me of these ‘property gurus’ (if you’re in property you know what I’m talking about lol) possibly why I haven’t got a lot of time for him.

Sorting the family life out / not spending all my free time looking at way to spend money I think will help me with the mindset.

Corona - we’re in ‘high’ tier. You might say we’re ‘north’ but most from the actual north wouldn’t haha so we don’t know what we are. Not as bad as I thought it would be tbf can meet up in a garden?! Does Boris seriously think we’re doing that in the middle of October? Doesn’t affect business as far as I know so happy days. 

@annabanana82 You’ve just given me permission to spend up to £600/625k on a car at current house value... very happy days hahaha. 

@clairebeth/ @ladyholly/ @DayDreamerandGeneralWaster Had a bit of time to reflect and I can either spend my life bitter about my marriage for no good reason - just another thing I’ve considered not good enough over the years. She does basically treat running the house like a job, thought about the hours she puts in and she works hard. I’ve not been fair to her at all over the years and tried to make up for it by spending money. Suppose I’ve had the attitude of I earn the money I’ll decide where we live, what we drive etc Generally been entitled and selfish - not the kind of person I want to be or how I want to be remembered by my son when he’s older tbh.