Live on £4000 for a year - Part 2

Marru

Hi,

I guess everybody has a bit different rules. I don't include nursery fees and only include the bit of the cost of looking after my animals that is not covered with my earnings that goes into the Olympic challenge (so far haven't had to include any of these costs). Even then it is tight as I do include running my car but if I do go over I still have saved loads of money by being mindful of how I am using it (and I don't include loan payments).

By the way, good news from tax credits, if I can keep up working 16 hours per week I can be a student won't change my status in receiving tax credits. Will be hard work but bring it on...

Marru

Frugaldom

guiri wrote: »

I've just found this site and it's helped me already by getting my credit card rates reduced. I'd like to belatedly pick up the challenge, but when I looked at the first posting at the beginning it said that 'EVERYTHING except rent/mortgage, council tax/water rates' However, the two lifestyle examples that nykmedia gives seems to take off everything, including loan repayments, car running expenses etc. before the balance to live off. Which is correct?

Hello Guiri, I think you must be refering to the following 2 lifestyles:


Lifestyle/Family 1
Couple with 2 of a family, husband works full time on a salary of £30,000 and wife is a full time mother/homemaker (not sure what the politically correct term for this category is any more!) Total income approx £452 per week including Child Benefit.

Mortgage & Buildings insurance - £740 per month = £170 per week
Council Tax/Water - £125 per month = £24 per week
2 cars, both on HP - £300 per month = £70 week
2 x road tax, insurance, servicing, petrol/diesel etc = £270 per month = £62 week
Credit cards - £100 per month = £23 week
Bank loan - £100 per month = £23 week
Total expenditure before actual living expenses - £372 per week
Balance to live off - £80 for everything else (£4182.85 for the year)

Lifestyle/Family 2
Couple with 2 of a family, husband works full time, wife part time, joint salary of £18,000 plus Child Benefit, total income approx £300 per week

Mortgage & Buildings insurance - £303 per month = £70 week
Council Tax/Water - £100 per month = £23 week
Home Improvement loan - £266 per month = £61 week
Credit Cards - £100 per month = £23 week
Other debts - £100 per month = £23 week
Car - road tax, insurance, servicing, fuel etc - £100 per month = £23 week
Total expenditure before actual living expenses - £223
Balance to live off - £77.00 for everything else (£4026 for the year)

This whole challenge is about a frugal lifestyle, doing whatever it takes to live within a £4000 budget for the COST OF LIVING. The above (both real examples) show that family 1 has an income of £452 per week whilst family 2 has an income of £300 per week, but their 'cost of living' budgets are fairly similar. (This does not take into account any working or child tax credits.) The above are purely house, council tax and self-imposed costs, they do not include cost of living, as in the absolute NEEDS such as food, clothing, heat, light etc. I rounded the figures down to £4000 to pay for everything else needed to survive. Not everyone has debt, not everyone has a mortgage, not everyone pays rent and not everyone owns cars or has children staying at home. These are all circumstantial, but EVERYONE needs to live.


Can you live on £4000 for a year?
That's for a typical household, but you'll also have family allowance/child benefit if there are children in the home.

Some reasons for doing this challenge:

£4000 (or less) really is all you have to live off after paying debts
You strive to live off £4000 and everything else pays off debts
You strive to live off £4000 and everything else gets saved
You are mortgage free, have £100,000+ in the bank and live off £4000 interest

Some people chose not to attempt £4000 (+ child benefit if applicable) and opted for a higher amount or lower amount depending on their personal circumstances.

Hope this helps to make it a little clearer and I hope you pick up loads more hints and tips by reading the MSE forums.

Frugaldom

Marru wrote: »

By the way, good news from tax credits, if I can keep up working 16 hours per week I can be a student won't change my status in receiving tax credits. Will be hard work but bring it on...

Marru

That's great news, Marru, and should take a weight off your mind. You are very brave taking on both work and study whilst having a young child: I wish you loads of luck and every, possible success.

MrDT

Bit late getting back to this thread, but I'd just like to wish mumzy good luck giving up Hope it has gone well so far!

Mollymop5

Evening everyone.It's been glorious sunshine here today and i've had a really busy day shopping.
Nyk loved the jaffa cake sory.wish I'd been a fly on the wall hehe
Still keeping a running diary on spendingdiary.com.This is so helpful at keeping me in check.I can't wait for the day I can live on £4000 for the year and have the other amount as savings and not for paying off debts!

slowlyfading

Mollymop5 wrote: »

Evening everyone.It's been glorious sunshine here today and i've had a really busy day shopping.

And bought....? :rotfl:

Mollymop5

slowlyfading wrote: »

And bought....? :rotfl:

always someone watchin huh!
I bought a school dress for DD £4.00
A hoodyand tea shirt for me £17.00
2 beautiful hand painted vases to sit on my dresser.£7 the pair
and a creme egg bargain at 20p in woolies

oh and.....High school musical quilt cover(birthday pressie) £12.00

bails

Hehe, good question SF!
Well done Marru!
Only 1 hour 33 minutes til bingo, can you stand the wait?

Marru

bails wrote: »

Only 1 hour 33 minutes til bingo, can you stand the wait?

:rotfl: :rotfl: :rotfl:

This has been a day for giggles. I went to Co-op to get some essentials for DD's evening snack before picking her up and at the till the giggles came and I had to bite both my lips not to start laughing. I was stll giggling at the nursery and poor lady who runs it is now totally convinced that I am mad.

Tomorrow - bingo and cleaning. No point in attempting anything else as the bingo will eat all my virtual memory.

See you at the stables...

Marru

sophiesmum_2

Okay if it is confession time I met up with a friend for meal out. Luckily she is also a frugal friend so we went to the BOGOF pub and had chicken and bacon salad, shared a portion of chips and had a lime and soda each. Total damage £5 each:D Not a planned spend but enjoyed catching up and not cooking so worth the £5.;) Will update sig in a minute.