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Budget - does this sound sensible?

(14 Posts)
SweetColibri Mon 24-Nov-14 19:07:15

Am looking at moving back to the UK and have been out of the loop for a few years so trying to see if the large salary cut I would be looking at is achievable in terms getting to the end of the month. Any ideas on the below gratefully received. I have to support DS (17 months) and DP (stay at home Dad).

My take home salary would be approx 3400 GBP per month (approx 64k per year). I would get an apparently near enough guaranteed bonus of 16% of my salary but not counting that in the below. Below are what I think my outgoings would be.

Mortgage - allow up to 1500 per month. I appreciate we could get somewhere a lot cheaper if renting but in the area am looking to buy prices are around 290k for something normal and with the deposit I have got saved (about 40k plus some for stamp duty) this is what mortage costs seem to work out to on a 4% rate basis.
Season ticket - 390 a month.
Council tax - seems to be 137 a month for a band D in the area looking at.
Car finance - don´t know how much we could save on this but we don´t have a car in the UK and would need to buy from scratch. Allowing up to 200 per month.
Gas/electricity - 150 a month. Might be able to shave a bit off this.
Water - 30 a month.
Car insurance - can´t remember how much this costs but guesstimating 40 a month.
Pet insurance - 40 a month.
Mobile/Landline - 50 a month.
Home insurance - 40 a month.
Child maintenance (I help my unemployed DP support his daughter at university) - 158 a month.

I am trying to be as conservative as possible in the amounts included above. It´s coming in at a pretty high 2735 per month, before I even factor in petrol and food costs. Once I factor those in, this doesn´t then leave much or anything left over at the end of the month and certainly nothing for savings.

It seems insane that what is by any normal standards a decent salary is actually achievable in terms of budget. It would be a major lifestyle boost to get this job as it is a 9-5 compared to the horrific hours I work at the moment. That said, I am terrified (as the sole earner) of getting up to my neck in financial doom or or going back to my student or early career days of never seeming to be able to get to the end of the month. As much as I hate my job at the moment I don´t worry about money, which is nice.

I can only see that this would be possible if we cut back a lot on mortgage or rent costs. Otherwise it just feels too tight.

Any comments or glaring holes in the above gratefully received, I cannot seem to see the wood for the trees on this at the moment. Desperate to accept the job but something is holding me back.

addictedtosugar Mon 24-Nov-14 21:21:44

Looks to cover most bits to me.
Would that take home be reduced by a pension contribution?
One missing: TV licence 12/month.

Looks like your living in London? In which case would you need a car straight away?

We spend about your 3K/month BUT our mortgage is more like £600 (sorry, lower rate, and cheaper part of the country). We run two cars, but they are owned outright, and there is no season ticket, or work parking costs. I would think your first years car insurance, unless you have some no claims bonus you could transfer would be more than £40/month. You's also need tax disk, servicing costs, and possibly MOT for the car.

£650 for food, clothing, emergency fund doesn't sound like loads, but would be doable if you wanted to.

MsRinky Mon 24-Nov-14 22:30:59

I think you might struggle to borrow 250k with the new mortgage rules, presumably a limited credit history in the UK and two, possibly three dependants.

zipetwhippet Mon 24-Nov-14 22:48:51

seems tight tbh
how many pets do you have? we have 1 dog= £11 a month pet insurance.
we have a smallish car owned outright and insurance is only £25 a month tax is £20 a year.
Would you need a car and a season ticket if only one of you at work?

It looks a good wage on paper but when you add all your outgoings it doesn't leave much left over.

Will your dp be looking for work soon?
Do you think you would get opportunities for promotion quickly?

SoonToBeSix Tue 25-Nov-14 00:08:10

Internet £20 , water more like £50

specialsubject Tue 25-Nov-14 12:43:06

car finance is throwing money down the drain. A lump sum of £2-3k will get you a perfectly good car. Actually, £500 will get you something with a year's MoT that could run for years. It just won't look very good.

you should run some insurance quotes first to see what you can afford to drive - with no no-claims you might be in for a nasty shock.

also that budget has no food money!

TywysogesGymraeg Tue 25-Nov-14 12:49:32

�64K is a very good salary OP, particularly outside of SE England.

My advice is that no bonus is "near enough guaranteed" so treat that as a bonus and don't factor it into your budget.

OnIlkleyMoorBahTwat Tue 25-Nov-14 14:07:12

Can you do without a car if living in London? Insurance would be expensive and you might not have anywhere to park it.

A lot will depend on how frugal you can be. If your DP can make the most of his time at home by shopping around for cheaper food and batch cooking, your food bill could be half what it would be if you just bought what you wanted in Waitrose/Tesco. Similarly, will you be taking a packed lunch, or popping out to M&S/Pret?

Being careful in just those two areas could save hundreds of pounds a month and make a huge difference in your standard of living.

OnIlkleyMoorBahTwat Tue 25-Nov-14 14:10:45

Sorry, don't know where I got living in London from.

If you need a car (and there's a lot to be said for trying to arrange your home and work so that you don't - eg. if you work in a city centre, can you live in the city centre too?), brand new city cars can be cheap on a PCP deal that includes servicing and no MOT for 3 years. Insurance, tax and fuel consumption are cheap too. If you can manage with a very small car, I'd say they are probably cheaper than buying an older larger car.

nottheOP Tue 25-Nov-14 14:13:43

We bring in �3,350 pcm. Our mortgage is �782 and this allows us a bit of breathing room. �1,500 would make everything very tight.

Applejack2 Tue 25-Nov-14 14:46:41

If you lived in a cheaper part of the country (like my north east) then £64K would get you a long way. You could buy a house, probably similar to what you are looking at, for a LOT less and live a lot cheaper.
Our combined salaries come in at around £3200 a month. Our mortgage is £730 but we are overpaying and have reduced the term down to increase payments.
What do you do for a living? Is it possible to move elsewhere in the country?

SweetColibri Tue 25-Nov-14 16:54:07

Thanks to all for the comments, incredibly helpful to think it through like this.
I´d be working in London but would rather/can only afford to live out - hence hefty commuting costs.

I have another house but my parents are living there at the moment so I can´t sell it to release the equity (they are renting it from me at market rate but Dad going through lots of problems at work at the moment so cannot get them to leave). So am stuck with what I have been able to save for a deposit, which does not get me that far in SE England.

DP won´t be looking for work as anything he could earn would be limited - he speaks pigeon English and looks after DS in the day. We would spend more on childcare than he would earn.

Unclear re promotion, keep asking the question but I think may have to live with this salary for a while.

Noted re insurance, had not thought of this. I have a car where living now with insurance history and had a no claims history in the UK before leaving but hadn´t thought would be starting from scratch from a UK driving perspective. We also do have a claim on insurance here due to a stupid accident DP had!! His fault entirely but screws my no claim as he is named driver. Bugger.

Noted re bonus, not factoring it in at all. And it is only payable in Feb each year so my main concern is making sure it is possible to live day to day before that.

As per above, can´t live w/o car as we won´t be in London. We could scrounge around more for food (we would have to) and I would have to get organised re lunch etc. Otherwise my entire food budget for the month could go on Pret sarnies and general rubbish I usually fritter my money away on.

Will look into car options more, I reckon that whatever I do I am not going to get it much below 150 a month although might be able to get the insurance and MOT package thrown in I guess.

nottheop - v helpful to have the direct analogy there. My thoughts are this would be doable if I had a lower mortgage. The mortgage on my existing house (where parents living now, as per above) is about 890 a month. I would either need to go back and live in my current house (which is a shocking commute to London each day and therefore eradicates most of the supposed work life balance benefits of taking on this job) or sell it to free up equity to buy somewhere else and have a smaller mortgage.

Applejack I am a lawyer. Could try to look at other areas but you tend to take a major salary hit as soon as you move outside London. There was a fantastic job I was going after with London salary despite out in the sticks - got up to second interview but no further, grrr.

I am still negotiating the salary with them to see if can get it up a bit. Assuming I don´t get anywhere with this, unless I have a very, very difficult conversation with my parents I just can´t see how to make this work. We could rent somewhere a lot cheaper but not sure we will end up achieving much - the idea of moving back to put down roots.

Thanks to everyone again

nottheOP Tue 25-Nov-14 17:57:28

Re a car you could look at leasing a vw up or similar. Search on what car comparison. With 3 months down it can be as cheap as 90 per month. No mot and no tax but you do have to keep up with servicing and the car has to remain perfect aesthetically. It is cheap motoring.

Dh got a 107 last year. His first years insurance was 240. No no claims beforehand.

SoonToBeSix Tue 25-Nov-14 18:00:36

If you aren't living in London £1500 k is too high for a mortgage.

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