How much to live on

Albermarle

Organgrinder said:

Gosh our tax system is bizarre.

I pay tax at 40%. I put enough into a pension to get that tax back after my tax is calculated at the end of the year.

I'm therefore classed as a basic rate tax payer and can earn £1,000 in interest before paying tax on it as opposed to £500.

My gross earnings are about £61,000. Of this a total of £13,000 gets paid into various pensions. Which means my taxable earnings are actually £48,000.

I'm somewhat gobsmacked that tax breaks like this are available!!! Not complaining though!

If you were claiming child benefit, this would be another tax break as well. Maybe after the budget, some of these breaks may be blocked.

helensbiggestfan

Organgrinder said:

Gosh our tax system is bizarre.

I pay tax at 40%. I put enough into a pension to get that tax back after my tax is calculated at the end of the year.

I'm therefore classed as a basic rate tax payer and can earn £1,000 in interest before paying tax on it as opposed to £500.

My gross earnings are about £61,000. Of this a total of £13,000 gets paid into various pensions. Which means my taxable earnings are actually £48,000.

I'm somewhat gobsmacked that tax breaks like this are available!!! Not complaining though!

Actually I would use the word labyrinthine. lol. But yes also bizarre. 

I have mentioned before that I suffer from dyscalculia but wasn't diagnosed until I was well into my 40s. Up until then I just accepted everyone's  verdict that I was useless at maths so I tended to shy away from anything involving numbers and never really took full responsibility for my finances.  Big mistake but I lacked confidence in my abilities. 

When my husband became self employed and we set up our own company we employed an accountant, a legal requirement as we were a limited company. At first I just sort of tidied up his expenses and managed the petty cash and then passed everything onto the accountant.  But gradually, as I gained confidence, I began to take more interest in the financial side of the business and adopted a more hands on approach, taking over the VAT, invoicing etc. Then one day I looked at the tax demand that the accountant said we owed and I had a niggling feeling........the amount seemed excessive and if I am honest I never felt really comfortable with the man.  I found him patronising and condescending and it made me distrust him.  

I mentioned I thought the tax bill seemed rather high to my husband but he was too busy to investigate so he asked me to dig a little.  I bought myself a tax guide and spent 2 days pouring over our accounts.  I kept phoning the accountant to ask questions.  I could tell he was not best pleased at what he regarded as my "interference" and he tried to fob me off.  But, he hadn't reckoned with my persistence. 

After I had gone through everything I requested a meeting with him and armed myself with all the notes I had made, referencing the various tax rules and then gave him both verbal and written instructions on how I wanted to restructure the business.  He was furious but he couldn't argue, after all I was the client and I could easily take our business elsewhere.  

Fast forward a couple of months and HMRC issued a cheque for a £2280 refund.  Not bad for 2 days work. Turns out I wasn't so dumb after all.  Lol.  The lesson I learned was that we should never trust the management of our money to a third party without monitoring them,  The accountant wasn't doing anything illegal but he certainly wasn't giving us "best advice".  

  One of the best money books I've ever read is a book called "Nice Girls Don't Get Rich". Aimed at women but I think it's just as useful for men.  It's American so obviously the pensions and tax advice isn't appropriate for the U.K. but the principles are the same.  The main takeaway is always take responsibility for your own finances, that's one thing you should never delegate.  Obviously there are times when we need accountants and proper investment guidance etc but we should always keep a watchful eye on our advisors.  

I don't want to be a Negative Nellie about the forthcoming budget but I am not hopeful.  I suspect there will be a few stings in the tail.  

 

jackieblack

otb666 said:

I thought I would post update on my figures as have not done it for a while.  Retired 5 years ago budget still the same 1800pm with 3000pa for insurance car and presents.  The 1800pm is split 700 bills 600 food 500 everything else.  (used to be 600/600/600 but bills went up)  With the food i keep in budget my changing my staples from expensive food to cheaper food and good incentive not to overeat. We have had a lot of work since we retired with the elderly relatives and glad we retired so we were there for them but also glad that stage is coming to the end.
Anyway just thought I would post as not everyone wants an expensive retirement as never had an expensive life and seriously after decades of skintness cannot change my ways now haha

A good example of how we’re all different, as my figures will be almost exactly half of yours, although you say “we” and I’m on my own… but most bills aren’t double for a couple from what they are for someone living alone.

Organgrinder

For those of you with a bit of spare cash I really cannot fault using Topcashback to open some ISAs.

At the start of the financial year I opened two accounts, one with Shepherds Friendly and the other with Scottish Friendly.

The total monthly outlay was £130. To date I've paid out £910 and the investments are worth £970. A 6.6% return.

The best bit however is the £445 cashback generated. A whopping £505 total return from a £910 investment. 55.5%.

Obviously there is a risk they can fall in value but at the level of cashback offered it would be one hell of a crash to lose money!

Albermarle

Organgrinder said:

For those of you with a bit of spare cash I really cannot fault using Topcashback to open some ISAs.

At the start of the financial year I opened two accounts, one with Shepherds Friendly and the other with Scottish Friendly.

The total monthly outlay was £130. To date I've paid out £910 and the investments are worth £970. A 6.6% return.

The best bit however is the £445 cashback generated. A whopping £505 total return from a £910 investment. 55.5%.

Obviously there is a risk they can fall in value but at the level of cashback offered it would be one hell of a crash to lose money!

Just disregarding the cashback for now, it has to be said that these Friendly Society investments ( there a few different ones) get a negative reaction on the Savings and Investments forum.
The investments used are typically quite old fashioned, with poor long term performance and high fees.
Of course there maybe exceptions to the general rule. Plus of course this what seems to be a very generous cashback, alters the equation significantly !

Organgrinder

Albermarle said:

Organgrinder said:

For those of you with a bit of spare cash I really cannot fault using Topcashback to open some ISAs.

At the start of the financial year I opened two accounts, one with Shepherds Friendly and the other with Scottish Friendly.

The total monthly outlay was £130. To date I've paid out £910 and the investments are worth £970. A 6.6% return.

The best bit however is the £445 cashback generated. A whopping £505 total return from a £910 investment. 55.5%.

Obviously there is a risk they can fall in value but at the level of cashback offered it would be one hell of a crash to lose money!

Just disregarding the cashback for now, it has to be said that these Friendly Society investments ( there a few different ones) get a negative reaction on the Savings and Investments forum.
The investments used are typically quite old fashioned, with poor long term performance and high fees.
Of course there maybe exceptions to the general rule. Plus of course this what seems to be a very generous cashback, alters the equation significantly !

I don't disagree. However for a short term return these are excellent when factoring in the cashback.

Baileys_Babe

Organgrinder said:

Albermarle said:

Organgrinder said:

For those of you with a bit of spare cash I really cannot fault using Topcashback to open some ISAs.

At the start of the financial year I opened two accounts, one with Shepherds Friendly and the other with Scottish Friendly.

The total monthly outlay was £130. To date I've paid out £910 and the investments are worth £970. A 6.6% return.

The best bit however is the £445 cashback generated. A whopping £505 total return from a £910 investment. 55.5%.

Obviously there is a risk they can fall in value but at the level of cashback offered it would be one hell of a crash to lose money!

Just disregarding the cashback for now, it has to be said that these Friendly Society investments ( there a few different ones) get a negative reaction on the Savings and Investments forum.
The investments used are typically quite old fashioned, with poor long term performance and high fees.
Of course there maybe exceptions to the general rule. Plus of course this what seems to be a very generous cashback, alters the equation significantly !

I don't disagree. However for a short term return these are excellent when factoring in the cashback.

@Organgrinder how much are you planning on investing?

littlemissbossy

littlemissbossy said:

Me 51 Hubby 56

Hubby has been retired for about 18 months, I'm reducing my hours from 3 days per week to 1 day per week from March 23

Council Tax 173.00                       197.00
Gas & Elect 150.00                       125.00
Line rental & broadband 30.00       27.00
Sky 56.00                                        59.50
Water 33                                         46.00
Charity 11.50                                   11.50
TV Licence 13.50                             15.00         
Lottery 16.00                                     0
Food/drink/toiletries etc 170.00      170.00
Petrol 80.00                                     80.00
Going out 150.00                            150.00
Car bills (insurance/road tax/service/mot) 45.00     80.00
House insurance 10.00                                          15.00
Misc 20.00                                                              30.00

= £958 per month x 12 = £11500 ish               = £1006 per month x 12 = £12072

My personal pension contributions 1560 pa      1560 pa
Holidays 2800 pa                                                2800 pa
New car 2500 pa                                                2500 pa
House (repairs/renewals etc) 2500 pa                2500 pa
Contingency 2000 pa                                         2000 pa

£22860 per year                                                   £23432 per year

Hope I haven't missed anything.


eta: my employer pays for my mobile phone and hubby has PAYG £10 every three months or so.

I thought I'd give a quick update on my figures from Feb 23. (updates in bold).

Me 54, hubby 59.

Organgrinder

Baileys_Babe said:

Organgrinder said:

Albermarle said:

Organgrinder said:

For those of you with a bit of spare cash I really cannot fault using Topcashback to open some ISAs.

At the start of the financial year I opened two accounts, one with Shepherds Friendly and the other with Scottish Friendly.

The total monthly outlay was £130. To date I've paid out £910 and the investments are worth £970. A 6.6% return.

The best bit however is the £445 cashback generated. A whopping £505 total return from a £910 investment. 55.5%.

Obviously there is a risk they can fall in value but at the level of cashback offered it would be one hell of a crash to lose money!

Just disregarding the cashback for now, it has to be said that these Friendly Society investments ( there a few different ones) get a negative reaction on the Savings and Investments forum.
The investments used are typically quite old fashioned, with poor long term performance and high fees.
Of course there maybe exceptions to the general rule. Plus of course this what seems to be a very generous cashback, alters the equation significantly !

I don't disagree. However for a short term return these are excellent when factoring in the cashback.

@Organgrinder how much are you planning on investing?

The bare minimum. I believe they now have a 5 year clause that allows them to charge a £50 fee. But I think mine was 1 year. Even so, I think that as soon as the bonus is paid I will probably withdraw my money which should be in the next couple of weeks. So a £455 return on a £910 investment in 7 months.

That's good enough for me.

helensbiggestfan

littlemissbossy said:

littlemissbossy said:

Me 51 Hubby 56

Hubby has been retired for about 18 months, I'm reducing my hours from 3 days per week to 1 day per week from March 23

Council Tax 173.00                       197.00
Gas & Elect 150.00                       125.00
Line rental & broadband 30.00       27.00
Sky 56.00                                        59.50
Water 33                                         46.00
Charity 11.50                                   11.50
TV Licence 13.50                             15.00         
Lottery 16.00                                     0
Food/drink/toiletries etc 170.00      170.00
Petrol 80.00                                     80.00
Going out 150.00                            150.00
Car bills (insurance/road tax/service/mot) 45.00     80.00
House insurance 10.00                                          15.00
Misc 20.00                                                              30.00

= £958 per month x 12 = £11500 ish               = £1006 per month x 12 = £12072

My personal pension contributions 1560 pa      1560 pa
Holidays 2800 pa                                                2800 pa
New car 2500 pa                                                2500 pa
House (repairs/renewals etc) 2500 pa                2500 pa
Contingency 2000 pa                                         2000 pa

£22860 per year                                                   £23432 per year

Hope I haven't missed anything.


eta: my employer pays for my mobile phone and hubby has PAYG £10 every three months or so.

I thought I'd give a quick update on my figures from Feb 23. (updates in bold).

Me 54, hubby 59.

That's really interesting. You've done a good job keeping increases to a minimum.