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Does this budget seem realistic?(38 Posts)
Hi, I'm a first time poster, and just wanted some feedback about budgeting.
Myself and my dp we are in the process of buying our first place together, we live in the SE, graduated from university 3 years ago and both currently live with our respective parent, who have generously let us stay at home to save money. We want to get some perspective from others about our outgoings, to see if what we are estimating is realistic.
Our income after tax, pension and student loan deduction is £3183
This is the is the list I have put together of what I think our outgoings would be each month:
Council tax £150
Home and contents insurance £55
Gas and electric £130
Tv license £12
Supermarket shopping £240
Car Mot £5
Car insurance £40
Car tax £13
Car maintenance £20
DP train to work £172
My train to work £100
DP phone £18
My phone £8
My gym membership £20
Contact lenses £20
Charity Direct Debit £6
Total outgoings: £2370
Which would leaves us with with roughly £800 a month, I would then probably want to spilt it, so £400 went in savings, and the rest is used for birthday, christmas, social life and any unexpected household costs.
The place we are buying has a spare room that we could also rent out a room for about £400-500 a month too if we wanted too.
Am I missing off any big costs?
Thanks in advance for any feedback.
It looks comprehensive to me. 50 each is not very much to have for social things per week in my honest opinion so might be wise to rent the room out.
What's the interest rate on your mortgage and how long is it fixed for? What would your payments be if the base rate hit 5% for eg?
I think you are being unrealistic about only having £50 a week each for spends. Dentists, clothes, shoes, coffee out, magazine, library fees, friend's birthday night out, bottle of wine, dry cleaning, hair cut, money for the office birthday collection, new towels, deodorant, etc etc
Do you both spend much on clothes, makeup, haircuts etc? That's not on your list.
What about life insurance?
Membership of professional bodies?
It looks fine on paper, especially with the room-renting option. It's the petty cash that disappears so fast, IME. As said above, £400 between you for social things is not very much, but should be doable.
X post with several people there!
Mortgage is fixed a 3.34% for 2 years, over the next two years dp should get a pay rise from work in that time.
Where are you reading that the OP will only have £50 p/w for spending/social money, I read it as £400 a month
Ah ok split between two ... Apparently it's too late for maths for me
DP cut his own hair and always has, so no cost their, I go to the hair dresser 2-3 times a year, and so would use my savings or £50 a week budget on that. Make up I have so much of already I probably have enough to last me over 2 years and tend to get given it for birthday and Christmas presents from family. Same with clothes, I already have enough and probably only go clothes shopping 2-3 times a year and certain don't need any new clothes and often get clothes as gifts as well. No memberships to professional bodies, both of us work in creative industries and don't have any thing like that.
Re:Wine - we are not big drinkers so I don't think i need to include that, same with coffee neither of us buy that from a coffee shop regularly, we don't buy any magazines, or go to the library, don't use dry cleaning as we wear reasonably casual clothes to work. Dentist is £20 a year each. Toiletries I would include in supermarket shopping. I probably see friends 2 times a week and often with dp, and that is a mix of eating out, drinks, going to someone's house, cinema. between myself and DP I would be surprised if we ever spent over £60 collectively in week on events with friends.
never had life insurance before, that is a good point, I might look that one up. I think I get some kind of cover through my work but I will double check what that actual covers.
You need to at least double your water costs.
I will bear that in mind, I based that figure on how much money my sister and her dp spend on water each month. But ours could be more than theirs.
Is £400 a month on socialising/spending money for 2 people really not a lot? I though that was being rather generous to ourselves, bearing in mind that we have an extra £400 each month in savings we could dip in to if needed.
I personally think �400 is plenty.
Is their a water meter at the property. If not the rates should be quite easy to find out. We have 2 small DCs and a 3 bed house on a meter and ir water has just gone up from �31 a month to �50.
No debts? What about initial outlay for furniture, white goods etc? Not planning on buying a sofa on interest free for x years?
You are missing home maintenance. We put �100 each month in there for things like decorating, fixing the the thshower, new curtains etc. Also a holiday fund, again I put �150 in here.
Re the 'pocket money'. You and DP should both keep all you receipts for a month (it's a pain but do-able ) and see do you come in under or over budget.
Have you got furniture, bedding, towels, saucepans, garlic press, carpets, curtains etc etc for your new house? Is there going to be a garden you will want to plant stuff in? Major budget fucker in the first few months of home ownership!
Hi, thanks for all the replies. To answer some questions, we have never had any debts (other than student loan), never used our overdafts and put most purchases on a credit card and pay that off every month. We have never purchased anything before that we can't pay upfront, have always saved up and paid in something off in full, rather than pay for anything in instalments.
The house is being sold to use with all the white goods in it, it has a new boiler too. Not sure about how the water is measured, I will take a look in to that.
No sofa needed as we already have one we bought off a friend a few months ago. I would use the £400 a month savings towards home maintenance and holidays and leave the rest as a reserve.
We already have 2 beds, bedding, two drawers, 2 desks, 2 tvs, 2 laptops from each of our rooms at our parents houses and brought all the furniture ourselves, so would be taking it with us. There is a fair bit of the furniture and goods in the house we are buying that are being included in the sale, (previous owner died, and relatives don't want a lot of the bulky furniture items) so we are getting a dining table and chairs, all the curtains, drawer in the bedrooms, welsh dresser, garden table and chairs, garden shed and all the equipment in it. Garden is currently in a good state, just needs to be mowed. We would like to update the decor in the house more to our taste, but this is something we are thinking of doing gradually over the next few years.
We already have a lot of kitchen equipment, so plates, knives, saucepans, food processor, bread making machine, baking trays etc, these have been brought for me by a relative who over the years for Christmas and birthdays brought me things for my first home. Ditto my parents started a "bottom drawer" of items for my first home quite a few years ago and any time they upgrade to a newer household item they have kept the older one (if it works fine) for me to have for my first home. So we have things like a kettle, iron, towels, curtains.
About keeping receipts for a month, although I think this is a good idea. I find there is very rarely a "typical month", what with when Christmas and birthdays and other events fall, but maybe we should try it for this month just to see what it comes back with, although I think it would be bias as we have really cut down on spending money for the sake of it as we want to save up as much as possible. We currently run two cars and would cut down to 1 when we live together, as at the moment we mainly use them for driving to see each other, as we live about 18 miles apart and their are no trains that go that way.
Think I have mentioned everything I've been asked about.
looks great to me - at last, someone who thinks about insurance and doesn't think it essential to buy slap and clothes every week. And also knows that jobs can vanish just like that.
£50 is a bloody fortune for socialising unless you are some London fluff-bunny.
I think £20 a month for water and sewage is fine but it is area-dependent. But that's the only thing I can see that needs tweaking.
You remind me of me when I was much younger and DH and I got together. As long as you factor in a few % for interest rate rises then you should be fine. We are not big drinkers and even though we do still go out I found that as we got older we go out less.
In an ideal world they reckon everyone needs six months income squirrelled away. I don't think many people can afford to do that but for instance our boiler needed replacing and was 2k. Get together a cushion of savings asap. I see you have a new boiler but they should be serviced every year and it is about 50 quid for mine.
Life insurance to cover the mortgage is advisable. If you have a workplace pension scheme you will get a death in service benefit but as your not married you need to check who if anyone would get this and if anyone would get your pension.
We also had lodgers but only for about a year, it was we felt a necessary evil and we had one great lodger and one who was a pain in the bum. It did seem like money for nothing. We used the rent to buy a shed, named after our irritating lodger and new carpets for the whole house instead of the hideous patterned shite that was down. My top tip is don't buy much but buy good quality.
planning to have children anytime soon?
Good idea about remembering to get the boiler serviced every year, I'll add that in to household costs.
Definitely agree with the don't much much buy good quality, I don't see the point in cluttering myself up with loads of cheap stuff, unless I need something I don't tend to buy it. The money I save every year from having a cheapish phone contact (£8 a month), instead of a brand new an iphone which costs £35-40, like a lot of my friends have, is the equivalent to being about to go on put some money towards going on holiday somewhere, and I would rather have some kind of experience and go somewhere than have a posh phone. I think if we got a lodger, we would do the same, and use that money to buy good quality carpets or key furniture items that were well made.
Yes ideally we would love to get the the stage where we have about 6 months wages saved up for just incase. I am quite nervous about not have that kind of back up for a while, as myself and DP have always had at least a few grand in savings, but most of our saving are going into buying the house. And more people I know are into their overdrafts, let alone have any savings, so I hope we are in a reasonable position. We are only 26 and 25, none of our friends have children, so I think we are a good few years off from that.
didn't read this through before posting, it should be 'don't buy much, buy good quality'
That's what i thought at 27 - and here he is 8 months old (love of my life).
I have £200 a month to spend on myself and DH the same. I like buying clothes/make up etc but can't really do it as often as I like with this budget. It's definitely possible if you don't have a busy social life. I definitely feel like I have to be careful every month so not to run out of dosh but I definitely don't feel hard done by and enjoy life. I just feel happy to be debt free (apart from mortgage)
I probably do stuff i count as socialising 2-3 times a week, but that doesn't always involve spending lots of money, if I meet someone for a drink I will often just have a soft drink or two, so often thats just a couple of quid or we go somewhere free like a museum or exhibition. Going out for food would probably be £15-20 per person. Or just going to someones house and watching a film which is free. Then probably once every month or two I might do something that is a bit more unusual/expensive like a day trip somewhere, go ape, go see a show or a gig.
£20 for water seems very cheap, we live in West Yorkshire & our's has just been put to £60 a month!
You do need to factor life/critical illness insurance in though, it's an absolute must to cover your mortgage & give you a lump sum if the worst should happen unfortunately.
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