Childcare, Single-Income Family & Monitoring Cashflow 5 February 2022 at 12:42PM in Old style MoneySaving 22 replies 1.8K views

Shoxt3r

Hi all,

Apologies I wasn't quite sure where to post this as it covers a range of topics (maybe it should be broken up into separate threads?).

Anyway (as I'm sure many people are finding) it's tough with the cost of living rising all the time vs their pay not going up.

We work on our accounts on a monthly basis using Microsoft Money to keep an eye on expenses, ensure that payments are being made correctly and to monitor cashflow. It's a very time-consuming task as we type in all of our amounts from each account manually (if there was a free alternative which would automate this that would be good).

The recent announcement of the energy price increase has prompted me to look into our finances in more depth and work out what our "essential" and regular payments are. We decided to put together a spreadsheet of our standard monthly payments, with estimates for those that don't have a strict Direct Debit amount - for example weekly household expenses aside from the food shopping, pet supplies and days out. I'm currently in the process of also doing the same for our annual expenses based on the payments we made last year.

What I'm finding tricky is keeping up to date with general cashflow when it comes to combining monthly and annual expenses versus my pay, particularly as some payments fluctuate such as general household expenses. After experimenting with Microsoft Money I've found how to run reports on categories which has helped to understand it a bit and was used to inform our regular payments which again we've now put into a spreadsheet.

Our situation is that we are a single-income family with a young child (2.5 years); my wife used to work but is now a full-time Mum and I work from home but will be commuting into London at least once a week in the next few weeks. The COVID situation meant that like many others I began working from home full-time - before I was full-time and commuting on a daily basis into London at a cost of over £5,000 a year. We have a 2-bedroom house with a mortgage which we've had for 7 years - in 2020 we renegotiated our mortgage from a 5-year fixed to a 3-year fixed which brought down the re-payments by £120.00 a month (we have no current plans to move but this could change if we have another child).

After reviewing our "standard" expenses we have already highlighted areas where to save money such as budgeting days out and our food shopping (though we plan our meals as much as possible). In general it really doesn't feel like we splash out at all and it still feels like saving is a struggle. 

We do all of the usual things like cashback on online expenses where we can, spreading costs across the year and using credit card for rewards. At this point it would just be nice to work out a reserve. We own our car outright so there are no expensive finance deals and the credit cards (we have 2) are paid off in-full each month via a Direct Debit so no interest is ever paid on them.

As I said, our child is 2.5 years old so we're now thinking about looking into nurseries/pre-school using the free hours only at this time which will start from January. We've yet to weigh it up but my wife may return to work; she's conscious of leaving our child at nursery for long hours while she works, but also as she's trained to be a teacher she worries what the effect of COVID could have on us. Beyond that, going back into full-time doesn't feel like an option as we have the thought that any money my wife makes would simply go into childcare (thus defeating the point) and our other childcare options such as calling on grandparents are limited due to distance.

My work situation is that I'm full-time working from home for the time-being but there is a plan for us to return back to the office on a once-a-week (at least) basis in the next month or so which obviously has an impact on our expenses at around £200.00 a month. Like many companies we've had our fair share of redundancies across the business and general cashflow is very erratic. We are working towards getting a bonus this year but I haven't been paid one ever since I started at the company a few years ago so I'm not relying on it. I also haven't had a pay rise for 3+ years (not even to match inflation) which I feel guilty about talking about as I know there are many who are in a much more dire situation than I. I can't really complain since I'm working from home, so I'm saving a lot of money there (goodness knows how I afforded the commute to be honest but this was back when my wife was still working so I guess it evened out!), and I've also been given a decent chair to work on (some may say this is pretty much a given as the company has a duty of care)  due to back problems relating to a car accident I was involved in a few years ago so I take my chair as my "bonus" for last year. We were also given a single, small payment as a "thank you" but predictably quite a bit of this was swallowed up by tax.

My work situation has changed somewhat as my responsibilities have increased due to others leaving and I am managing an additional person since I had my last pay rise.

All in all we're not doing too badly and I can't really complain but that doesn't stop me worrying about even the small expenses and getting stressed every time the annual expenses (insurances, car servicing etc.) come around not to mention expenses that are unexpected on top of everything. We don't have any debts to speak of aside from my student loan - my wife also has a student loan but due to not working hasn't paid anything. We're doing what we can to save without trying to impact on our quality of life too much and claiming what we can such as Marriage Allowance and tax rebates for me working from home but I guess there are still some savings to be made with food expenses (though we do plan our meals as much as possible to spread across several days to save money) and days out.

I guess we would just really like some assurance and advice on what we can do as comparing with other people it feels like we're living from one pay cheque to another while other people appear to be able to splash out with cars, holidays and other luxuries and I can't work out how they do it - unless it's a ticking time-bomb of loans, re-mortgages and credit cards? I have no idea for example how my parents managed on a single-income (their response in short is "we just managed with help from our parents at times") but I have come to realise that when taking inflation into account, we're on a similar level with perhaps higher costs.

I also feel that I should count ourselves lucky and stop moaning as there are those that are in a much worse situation and that the additional expenses we do have are our own doing (days out, website/email hosting - £115.00 a year - and pet costs) and for example I wouldn't have the commute cost if I just took a more local job but that in itself means a pay cut.

Any help or advice would be really appreciated - apologies for the long post.

Rosa_Damascena

Probably the wrong board but what stands out to me is that people are scared to go to work knowing that it will put their families at risk. COVID is still rampant but schools are carrying on without as if the pandemic has been and gone.

middlewife

Hi, I think many people will sympathise.  You haven't given a SOA so difficult to offer specific advice. We raised 4 children, initially I went back to work full time, my husband worked full time often with the expensive London commute, or working away 3 days a week. My entire wage went on childcare with the vague thought that once our second child turned 5 my salary would be available again. That never happened as number 2 became 2 and 3. (Twins)i then stopped work altogether for a few years, did mystery shopping and we managed, just but it was hard, 3 redundancies,although hugely stressful helped to boost our income as OH found work within 3 or 4 months each time. 
Like you it takes us 3 or 4 hours to do our accounts properly  and there are always unexpected,  like the plumber currently upstairs trying to fix our elderly heating!
Things that strike me, you mention food spending and days out. I use Olio and get a fair bit of free food. I always cook from scratch apart from when I worked full time. Using anything other than an oven to cook on saves money. Daysout there are far fewer free or subsidised activities now we had 1p bowling in the school holidays before 9.30 followed by kids cinema for a few pounds, mostly all gone now. So maybe time to lower your expectations of what makes a good day out? You are probably worrying about something you ultimately can't do much about. It transpired that a lot of our former "friends" who seemed to have dream lifestyles and were very quick to ditch us when we couldn't afford to eat out with them, had it all on credit and lost out big time when redundancy hit.we have always paid our way as much as possible, apart from big ticket items, so when the inevitable redundancies hit we had less to worry about.
Ultimately, of course, you may have another child, the car will die at some point, who knows what will happen with your jobs...working with more than one child is a logistical nightmare. Maybe your wife could do some tutoring evenings and weekends to supplement your income? My sons girlfriend tutors and picks up a decent amount. You can and are doing your best!

bouicca21

Back in the day I hit a point where getting back into work brought no financial benefit as the cost of childcare wiped out my earnings.  I still did it - I wanted to work. Financially the gamble paid off as I my salary soon went up and other opportunities appeared.

Shoxt3r

Rosa_Damascena said:

Probably the wrong board but what stands out to me is that people are scared to go to work knowing that it will put their families at risk. COVID is still rampant but schools are carrying on without as if the pandemic has been and gone.

Yes I think that's what concerns my wife the most really is that she has many friends who are teachers who are going through this and both they and their families have been hit hard by it simply because of their line of work.

middlewife said:

Hi, I think many people will sympathise.  You haven't given a SOA so difficult to offer specific advice. We raised 4 children, initially I went back to work full time, my husband worked full time often with the expensive London commute, or working away 3 days a week. My entire wage went on childcare with the vague thought that once our second child turned 5 my salary would be available again. That never happened as number 2 became 2 and 3. (Twins)i then stopped work altogether for a few years, did mystery shopping and we managed, just but it was hard, 3 redundancies,although hugely stressful helped to boost our income as OH found work within 3 or 4 months each time. 
Like you it takes us 3 or 4 hours to do our accounts properly  and there are always unexpected,  like the plumber currently upstairs trying to fix our elderly heating!
Things that strike me, you mention food spending and days out. I use Olio and get a fair bit of free food. I always cook from scratch apart from when I worked full time. Using anything other than an oven to cook on saves money. Daysout there are far fewer free or subsidised activities now we had 1p bowling in the school holidays before 9.30 followed by kids cinema for a few pounds, mostly all gone now. So maybe time to lower your expectations of what makes a good day out? You are probably worrying about something you ultimately can't do much about. It transpired that a lot of our former "friends" who seemed to have dream lifestyles and were very quick to ditch us when we couldn't afford to eat out with them, had it all on credit and lost out big time when redundancy hit.we have always paid our way as much as possible, apart from big ticket items, so when the inevitable redundancies hit we had less to worry about.
Ultimately, of course, you may have another child, the car will die at some point, who knows what will happen with your jobs...working with more than one child is a logistical nightmare. Maybe your wife could do some tutoring evenings and weekends to supplement your income? My sons girlfriend tutors and picks up a decent amount. You can and are doing your best!

Thank you so much for your kind words - it really means a lot. Apologies, what is a SOA?

It's comforting to know that despite everything you have managed to get through it - pleased to hear that!

Thanks for the recommendation of Olio - I will certainly look into that. Likewise we always cook everything from scratch as otherwise it's just too expensive - it makes mealtimes with the little one that bit easier too. Yes 100% agree on days out - we try as much as possible to just go for walks which means either cheap or free parking but somehow it still manages to add up. However, like you say I think I'm worrying about things I cannot control (e.g. energy bills for one!) but still trying to make sense of it and how we can counter it - pretty much an impossibility I think other than just trying our best to reduce it.

That is very sad to hear about your former "friends" - it amazes me how people are so cruel as to ditch others over such trivial things!

Yes tutoring is something my wife has thought about actually - good advice! As I say, ultimately it would be nice just to have that little bit more in reserve should the worst happen and right now that's difficult to imagine. However, the review of our "essentials" has definitely helped bring some perspective and highlight some areas we could change to reduce costs.

With COVID and Brexit hitting the business I work for hard I think it will be difficult to negotiate a pay increase but I can certainly try - not to be arrogant but I do feel I add a lot to my area of the business and with my new training that should continue so fingers crossed!

bouicca21 said:

Back in the day I hit a point where getting back into work brought no financial benefit as the cost of childcare wiped out my earnings.  I still did it - I wanted to work. Financially the gamble paid off as I my salary soon went up and other opportunities appeared.

Yes that's a very good point - although a starting wage may barely cover childcare and other expenses there's always a chance of promotion/pay increase to help!

Rosa_Damascena

You can see why in past times having children would immediately plunge people into poverty. For the vast majority it still means tough choices.

Floss

As has been said, those with what appear to me more extravagant lifestyles may be just all flash & no substance i.e. living beyond means because "they deserve it". You seem to be living within your means.

Re tracking everything,  I have a spreadsheet with monthly tabs & a decreasing total linked to payment of DDs and run 2 bank accounts - one for bills & one for housekeeping which is funded by a monthly payment from the bills account. These are both checked daily (before I look on here & do my Wordle) and once paid out payments are coloured in. Housekeeping is logged using a diary - total at the top, payments out & in listed & carried forward. Simple but it works for me. I have a list of when annual things are due and they're into the list of payments in their month.

mumtoomany

Hi, you asked what a SOA was don't think anyone answered. Is a statement of affairs. There's a link. http://www.stoozing.com/soa.php .Don't know if that worked but if not it's on a sticky post on the first page of the debt free wannabes board. If you fool it in and post it, people will offer advice on how to reduce your outgoings. Or just fill in for yourself, handy to know where your money is going. 
Loss of good advice here. If you want to cut your grocery spends, try having a look at the grocery challenge thread, new one each month. Is of hours ideas and recipes, (front page,) good luck, mumtoomany.xx

middlewife

"SOA" -I've always taken to mean "statement of affairs", some people are happy to provide details of their budget on a public forum, others, understandably are not. It's not for the fainthearted as people can voice quite strong views on where you are going wrong! Particularly with food spend, people in similar situations will tell you to spend anything between £25 and £100 a week, but it can help if you post a more general post along the lines of "I'd like to reduce my spending by £x a week and I currently shop in M&S/Waitrose/Tescos/lidl etc (other stores are available). We now categorise our spending into a colour coded pie chart. The most frightening section is "coffee shop" it's easy to rack up hundreds in them. and I love them, but they are the biggest money sinks on days out for us....

gwynlas

Whilst it is good that you are receiving London weighting when WFH I think that you could enquire about a pat rise as responsibilities increased, Apart from tiuoring which pays well if available your wife could look into taking other jobs in prder to make a financial contribution our local Tesco is advertising a lot recently and even a minimal paid role would be worth having/ Others earn extra cash from trawlinng charity shops for as new goods and sell them on line.

Shoxt3r

Thank you all for your help and support. I will look into creating an SOA and report back when it's done. Thanks again!