Budget Advice

CJRyder

With regards to the TV Licence, politely point out to your OH that it's a luxury just for him. If he wants it, he pays for it out of his own personal funds. Either way, it's no longer coming out of joint household bills. Maybe point out that the cleaner is a luxury just for you and that you're axing that or paying for that outof your own pocket.

Most of the costs are quite reasonable. You may want to ask Three about the costs of exiting your contract and going sim only.

suziebear1985

MovingForwards said:

If you're paying for insurance etc monthly, see if it's cheaper to pay annually.

Depending on what your prescription is for, ask the Dr to do 3 or 6 months supply and say you're struggling to pay each month; I've done that before.

Are you getting loyalty points for the petrol? I save mine up to cover some of the December shopping. 

You've not mentioned saving for vehicle repairs / maintenance and need to put something aside.

No mention of car insurance either, again pay for it annually and start saving for it.

Monthly spending, as an adult you shouldn't need to buy clothes very often, obviously kids are growing. As for toiletries, can you swap brands?

Nothing for eye tests, dental, hair cuts etc.

Reduce the kids savings for a bit.

Little point stretching your finances for the cleaner if you're having to cut back in other areas.

If you eat meat, bulk it out with lentils, veg etc to make it go further. Cut back on sweet treats, cakes etc and have it as a once a week treat.

Can either of you increase your hours or take on a second job, Xmas ones are popping up and it's a temporary boost for a few months.

Have you done a benefit check recently?

Thanks for this advice. I will speak to the Dr and ask if longer prescriptions are possible. I haven't listed car insurance as mine is quite cheap (Less than £250 a year) so I pay it up front. I'll look to see if there is a cheaper deal with the home insurance though. I don't get loyalty points as such for the petrol but I get Nectar points as the cheapest station near me is the sainsburies one. I haven't saved anything for MOT yet this year, I paid for it upfront last time but after December I plan to incorporate this into monthly savings along with birthdays and Xmas. I've not really factored in eye tests and dental as we only go every 2 years to get our eyes tested and I have an NHS dentist so go every 6 month for a check up which is only £20 odd pound. Kids are free.

As I said I'm not struggling just looking to be sensible. I'm not entitled to any benefits but thanks so much for your advice I'll take it all on board.

suziebear1985

bupster said:

Break down the monthly spending. With a £200 pot you're going to spend up to the £200. As it doesn't include food there's a lot of scope here. If you're broke, you're also going to need to give up the cleaner - I know it's tough on her but if you were genuinely financially comfortable enough to support an extra person in your house you probably wouldn't be on here! 

Yes your right. I do need to do what is best for us I just really feel for her. She is quite busy and in demand so hopefully someone else will snap her up and I'll give a good amount of notice.

suziebear1985

-taff said:

Maybe you could try half the amount of cleaning for your cleaner? Check out the prices of annual payments instead of mnthly, they do hike i up a bit sometimes. For the tv licence, everything bar the bbc has catch up and there are sites on the web that stream football...I don't watch football and I don't have a licence but I do watch have netflix and basic with adverts is 4.99, basic is 6.99. You only really need that package you have if you're using multiple devices. The £200 month spends needs to be looked at, make a list of what you've used it for the last six months to get some idea.

I would talk to your kids about christmas this year and buy one present or do the IOU thing with each person doing something for someone else, get them involved in making presents for people, not buying them. Ditch the kids savings until you can comfortably afford them. Buying a PPC wil save you 4 pounds a year, and it may be worth it if you factor in unpredicatable prescription issues. How often do you listent o amazon music? With your vodafone, can you get free spotify?

Thankyou I will look at paying upfront for home insurance. My eldest is 16 and he does like watching Netflix in his room whilst we watch downstairs so think we would struggle to just use one device but if I get rid of the TV license I've saved there. I will definately keep a closer eye on the £200 monthly spending as it does just disappear on little things so I could be tighter. I could give up the Amazon Music for myself even though I quite like it. My kids use it on their alexas often but I believe there are free services too so going to look at that. Thanks so much.

suziebear1985

Bluegreen143 said:

You haven’t shared your income. If you earn £4,000 a month I wouldn’t bother making any changes but if you earn £2,000 you really need to, if you see what I mean so it is relevant.

Assuming as you have credit card debt you’re about breaking even though rather than having a large surplus - if you do have a surplus each month I’d aim to get this paid as quickly as possible. 

None of your costs seem outrageous if you can afford it (my barometer for affording your lifestyle is that you can save at least 20% of your income, including what goes into your pension, and you don’t go into debt for purchases - ideally you spend up to 50% on needs and up to 30% on wants). But there are a couple of areas you may be able to save on: 

- cleaner is a luxury as you note 
- £200 general spending for fun, clothes and children’s costs seems reasonable but could be reduced in the short term 
- making sure you channel any extra bonus money into paying off your debts as quickly as you can will free up more money in your monthly budget once they are gone 
- children’s savings could be frozen for now 
- your grocery and energy spends already seem low to me tbh but maybe eating more veggie meals and batch cooking will help. Less snacks for the kids, stick to toast and fruit, not things in packets (if you buy these) 

Thanks for your advice. The only debt I have (apart from mortgage and car which is nearly paid) is the credit card. Its 0% interest for 18 months so purely paying the balance. The minimum payment each month is £58 but I pay £200 to get it paid off ASAP. I used my cc to buy a new sofa as we were desperate as it was an amazing deal. Just meant I had to pay for it upfront.

suziebear1985

bouicca21 said:

Am I  out of date? I thought you needed a tv licence even if only watching Netflix?

I sympathise about the cleaner (though £50 is pretty good going) - it’s the obvious cut for me too, but it makes my life so much easier.  I have opted instead to try to cut down my food bill in ways that don’t impact the quality (as in tasty as well as nutrition) of my diet.  The meal planning thread has been great, not only because it has helped me impose some discipline on my shopping, but because there are so many great ideas.  I’m also picked loads of ideas from the Favourite vegan recipes you didn’t even know were vegan thread.

Mobile  phone - how much use does it get?  I saved loads by buying a refurbished iPhone and signing up to Giffgaff.

I think you only need a tv license if you have an aerial plugged in and you watch live TV?. Thanks for mentioning the meal planning thread I'll go and look at that.

suziebear1985

Thanks so much everyone it's such a big help. I don't really want to post my salary as it is quite high and I appreciate that there are lots of people who are really really struggling to make ends meet whereas I'm just looking to make savings as even though I'm OK for money at the moment it does make me anxious as I know circumstances can always change. I also support the whole family on my salary so doesn't stretch as far. Thanks so much for the advice I'll really take it all on board.

Bluegreen143

Oh you don’t need to share your income, totally understand it’s personal (we both have good salaries too and appreciate what you mean that not everyone does). But just think about it yourself.

If you take you salary and add back on the pension contributions which come off automatically (assuming you contribute to one - if not you should look into this). Eg imagine a fictional scenario where your salary is £2,000 and pension is £150 so total figure £2,150. 

Look at what 20% of that figure is - in our fictional example £430. £150 is your pension contribution so is our fictional person saving £280 a month (or paying it off debt). 

If you are saving (or debt repaying) to the tune of 20% of your income or more, and living on 80%, then I would personally class that as living well within your means. Some people like their savings rate to be even higher (25/30% or more) which is a personal choice but it doesn’t look to me as if there are many easy cuts in your budget. If you are needing more than 80% of your income to live I’d try to cut back (or earn more) using some of the suggestions given. 

But if you are saving/repaying debt with 20% or more of your income already I wouldn’t necessarily make huge sacrifices to reduce your budget. I think we all feel anxious because of the headlines etc but it may be that you’re doing totally fine and don’t need to be anxious or only need small changes. You can only tell that by looking at the whole picture including your income (again, you don’t need to share this). 

Once you have your CC paid off, I’d focus on building a decent emergency fund which will help you feel more secure. You could get a jump start on this by doing some decluttering and selling anything you don’t need.

Also worth considering if you have enough money aside for Christmas as that will be a problem if you don’t.

When you finish paying your car finance, I’d keep putting that money into a savings account to save for your next car. You may be able to buy one outright or at least reduce the finance needed depending how long your current car does you.

PipneyJane

@suziebear1985.  Firstly big hug for so bravely putting your budget out there for people to criticise.

Second, I’d keep the TV licence and ditch Netflix and Amazon Music.  You can get so much more from the BBC than just broadcast television:  thousands of classic movies and TV programs free on iPlayer; free radio and podcasts on BBC Sounds.  Officially, you do need a TV licence to access content on iPlayer.  Plus, if you swap to Freeview TV, there are around 100 free-to-air television stations and several of them have their own free streaming services (e.g. All4, My5, UKTV Play).   If your son wants Netflix, then tell him he has to pay for it out of his own money.  He’s old enough to learn about budgeting and treats.

The “free” music streaming service is Spotify.  There is also a subscription version.

Other thoughts re saving money:  

1. Do you have an Emergency Fund?  I see that you used credit to purchase much needed furniture, so I suspect not.  Ideally it needs to cover 3-6 months of household expenses.
2. When you pay off the car, save the £153 each month into a “Car Fund” for repairs, the inevitable replacement, insurance, etc.  You are already spending that money so won’t miss it.  Also, it’s cheaper to pay your road tax annually rather than monthly.
3. Ditto, when you pay off the credit card, save the money and, when you have a large enough pot, maybe you could use it to pay the balance of the £8k you owe your family member?  Or put it to your Emergency Fund.
4. I have multiple small saving pots, some of which you might want to consider for yourself: IT/Phone Replacement Fund; “Running Away Fund” (for holidays); Christmas/Birthday Present money; Christmas Food Fund (also pays for the Christmas tree and Easter eggs); Clothing Fund; Football Season Ticket Fund; Choir Subscription Fund; Haircuts & Makeup Fund (I get my hair cut every 2 months, so save half the cost each month, rounded up to the nearest fiver).
5. Get the prepaid prescription certificate.  Martin talks about timing your repeats so that you can get two lots on the one certificate, then let it lapse for 3 months, rinse and repeat.  If you do this, it is definitely cheaper.
6. Your phone contract is due for renewal in 2024 - are you paying for the handset on it?  If so, then when it finishes, swap to SIM-only contract, save the difference towards your new handset and pay cash for it.  (On their current cycle, today’s iPhone 14 should last at least 5 years, before Apple stop providing updated software for it.).

More generally, something I learned a few years ago is that if you set little pots of money aside each month for treats/hobbies/life-events, once you get ahead, you will stay ahead and things will be easier.

HTH,

- Pip

Floss

Bluegreen143 said:

If you take your salary and add back on the pension contributions which come off automatically (assuming you contribute to one - if not you should look into this). Eg imagine a fictional scenario where your salary is £2,000 and pension is £150 so total figure £2,150. 

Look at what 20% of that figure is - in our fictional example £430. £150 is your pension contribution so is our fictional person saving £280 a month (or paying it off debt). 

If you are saving (or debt repaying) to the tune of 20% of your income or more, and living on 80%, then I would personally class that as living well within your means...

This make sense, I just worked mine out and with my pension contributions I'm repaying & saving 21.4% 😁