I've just done a budgeting spreadsheet - shocked!

[Allnewtometoo]

Where does the money go?? I do know i have a bit of a "frittering away" habit. Buying a drink at work, getting the dc snacks from the petrol station, that sort of thing but jesus I cannot believe how much I should have "leftover" each month. I know that on paper can be different to reality but even so, this is mind boggling.

Can anyone recommend a way to sort myself out? Is there a plan/program/book?

I know some of you will say "just stop spending" but I feel like I need more than that.

I've previously read about sone sort of budgeting app but can't remember what it was called.

But how would it work if you decided you wanted a day out today?

If you had a Monzo days out pot, you could just use that and decide where and whether to take a picnic or have fish and chips or ice creams based on what's in the pot.

With YNAB you still have a pot but you'd have to keep checking it's done the categories right so at best it offers nothing more than you can do yourself for free by opening an extra bank account or two and setting up some standing orders.

I’m a die-hard snoop fan but I’ve just tried to set up YNAB. It’s quite an alarming and depressing reality when you input everything and it gives you the monthly expected allocation to categories (yearly spending everything / 12) and you have about £400 left out of 5k. Dear god. We are so so much better off than most and so lucky but just shows no-one should be complacent and the more you earn the bigger the bills seem to escalate, lifestyle creep is real (2.5 k of that is just mortgage, utilities, council tax, life insurance and phone/ sky / tv license. No cars on finance. No other debt. No childcare)

I have a YNAB days out pot, that’s exactly how it works. It’s no different to that Monzo pot, It’s just envelope budgeting. Every month, I fill up the categories, including my entertainment budget. Everything has targets done so one click assigns everything.

If that pot becomes empty during the month because I’ve spent it all, I’d have to cover it with money from another pot, so decide what my priorities are.

I don’t use my bank account to make spending decisions, I use YNAB. My bank accounts are just where the money lives.

I find Monzo very helpful because I can have separate accounts for different expenses which really helps me budget. Once the money is gone for say ‘coffee’ it’s gone. That’s it.

Yes it really is! I remember when I set it up and what I thought was X amount of free money turned out to be a fraction of it once I added all the other stuff together. It was sobering! But after the first year, it was amazing how smoothly our finances were running. No skint months, no casting around to cover bills, stuff like car repairs were still annoying but having the money sitting there takes away so much of the stress. And over time you work out tweaks and what your priorities are.

There’s a YNAB thread on here that is quite active!

A bit late to this but yes it's brilliant and completely worth it.
watch the instructions videos to get the idea of it first but I use it every day. It was scary at first but now I'm so aware of what I can and can't afford.
You still can have nice things you just have to have the money in the pot to have it.

Ok it wasnt clear that its automatic and @sometimesitsfine also mentioned gathering receipts so it gave the impression they were entered manually.

No It took me ages to work it out and then the penny dropped that all I was doing was replicating my actions anyway-I really couldn't fathom why I would need to pay for that
I think we are all different and I'm an actions person and I prefer my budgeting makes me money not DR!

Dave Ramsey is nothing to do with YNAB. He has his own software, EveryDollar or something. YNAB is just a small American company. Agree with the sentiments around DR though! Not my bag.

Is the money actually in the pot physically though?
Or just on a spreadsheet?

Ugh I really hate the way he shames people

Yes, I do gather receipts manually to add onto EveryDollar - because the paid version on the mobile app isn't available in the UK. The free version on a laptop is accessible, but it doesn't link to bank accounts.
It's brilliantly easy to use though, so I'm happy to manually input my spending because I like its format. (I've tried many others including YNAB and it's by far the best one I have come across).
Understand your dislike of the DR approach, but the process of the babysteps and budgeting tool have proved highly effective - and they are both free..

Move money at the start of the month have one account for disposable spends/fun money, one for bills including debt repayments and a set amount for grocery shopping, at least one for savings. Make sure all builds are on monthly DD so your outgoings are stable. It's a good start.

I do have a spreadsheet I divvy everything up on payday, DH is also a fritter but only uses his amount with his disposable income in it for that so it doesn't matter.
He is surprised by what we can afford (in a good way) but it's just because I'm organised with our finances.

ETA
we have these pots/accounts
Bills and groceries
DS spending (same amount every month summer months it's direct others it isn't which means there's enough for bigger expenses like uniform)
DS savings (this is actually split across a couple for interest rates but start simple)
Joint Savings
Slush fund (this is for things like MOT, if the boiler breaks, need a new lawnmower etc)
Petrol this is also where DH and I pay work travel claims into
Holiday fund
DH and I have our own personal accounts and get the same disposable money each month, he mainly spends his. I have two further personal sub accounts for my savings and my travel -troops with friends etc because I fritter less than he does.

DS also has a junior Monzo he gets £3 a week pocket money and birthday/Christmas money from relatives, he has pots off of that for savings, birthday money (he prefers to spend that on something special), he then sometimes has a pot of he is saving for something in particular the last one was a Lego kit and you can attach a photo to it, so once a month I sit with him and say this is his much you have in your account from pocket money where do you want to move it to and how much do you want to leave in the main account for comics etc. He's 6 and I think it's a good habit to have.

Sounds like you’re doing well OP. It can be hard to change spending habits.

Evening all, an update for anyone who is interested.

Went out for our walk today, left early. Normally have 2 coffees before going out, but had only had one so rather than getting a takeaway coffee I took one with me. I also took lunch, fruit, snacks and water. Had a lovely walk, and at the end the dc had seaside donuts and I had another coffee. £5. We called to visit family and stayed longer than expected. WasVERY tempted to get fish and chips overlooking the beach, decided not (helps that my stomach doesn't cope well...)

What was more difficult is not saying "shall we just get McDs" to the dc as we didn't get home till 6.30. Instead we've cobbled together some bagels, veg sticks, yogurt, piece of leftover birthday cake etc.

Very very pleased with today. I could easily have spent £50.

Reading back....I do like the look of ynab , and may look into it again in future. I just found it difficult to set up, didn't understand what it was saying about the OD at all, and at this stage it needs to be simple and easy, I need to get going while my enthusiasm is there .

Its only the 2nd of the month but im feeling hopefully and quite confident I can turn this around!

Thanks to everyone for their support.

Brilliant op. You’ll be booking that holiday in no time.

Well done OP!! I came back to this thread this evening to check for an update :) sounds like you all had a great day and you had some treats but you spent a tiny amount. I would always make sure you have a backup / easy cheat meal in the freezer like frozen pizza or noodles in the cupboard when you need dinner really fast. Pitta bread pitta is very quick too. Or if you know you’re have a day out and you do a food shop in advance maybe get some fresh pizzas in or chicken goujons as they take a short time to cook (and you can freeze them if they aren’t needed). Or even cook the pizza / chicken etc in advance and they can have it cold for dinner!

Also I’m finding YNAB soo confusing! It’s really complicated, it’s done something a bit bonkers to my bill payments and showing twice so showing my account minus when it’s not, I think I might need to stick with Scoop and a budget spreadsheet!

I was only saying yesterday how I don't buy frozen food really, as in nothing I can cook from frozen. I buy meat and portion up and freeze but then it needs defrosting and cooking. So I need to investigate the frozen section.

Thank you for checking in. I feel a bit foolish being cheered on by strangers but it does help!

Well Done OP!

Bet the kids were starving after their walk, mine always are. 🙂

I'm in the fortunate position that I don't particularly need to budget but I am naturally frugal also. I am quite strict - no wine, no takeaways, no coffee out.
I make mine at home & take it with me.
It's all the little things that add up...

The obvious frozen foods to look at would be pizza and ice creams. Even nice versions of either are far cheaper than takeaways or buying while out.

We get Crosta Mollica pizzas from Costco which are under £4 each and the same as those cooked in a wood fired oven in a good pizzeria. Or I'm sure you can get a Domino's dupe if that's your preference.

Instead of buying ice creams at £3+ each at an attraction, you can get a box with enough for everyone for that price from a convenience store or supermarket on the way home or keep in the freezer to have at home.

Today's update, if anyone us interested!

I've just logged onto my daily current account and worked out what payments are going in and out for the rest of the month (keeping in mind mortgage, utilities, CT, car costs, are paid)

I've set a budget for groceries, fuel, pets and worked out how much I will have left. I have some cash already set aside for our 2 short breaks, and think that will be enough for those

I do have sone school stuff yet to buy but its looking promising that I will be able to do this out of my daily account and not use the CC.

I did an eligibility check fir a Tesco CC and was given 0% chance of being approved. I don't kniw why as though I have an OD and other CC, I've never defaulted.

@Allnewtometoo check your eligibility for a 0% CC on Martin Lewis Money Saving Expert—they’ll find the banks who will
approve.

Probably affordability-they have really tightened this up
Tbh you have to be extremely disciplined to make this work

I would focus on budgeting what you have first and park the CC idea until you have paid off the OD and spent time budgeting

Well done OP! I've been getting on top of this. Well worth looking at Rebel Finance School when you have time.

I find it best to get paid into account then have all bills (DDs/SOs) from another account.

I also have an Irregular Spends account which is for all the one off or not every month costs. I have a separate spreadsheet with lists the items and how much goes in each month for each item. So I always know. This has been a game changer as it really makes me stop and think - wait is that on the list or not.

I then have a separate account for my daily budget. I use Hyperjar which is a prepaid card, but am thinking of switching to Chase. Basically both are good as they allow me to put my money into visual pots. Food, petrol, fun etc.

I have set it up so I always spend from a certain pot automatically e.g. Aldi. No more recalculating all the time. Just do a weekly check. Move things between pots if I need.

Re priorities, usual advice is:

Work out your income and expenditure, cut what you can to increase the gap between the two. Prioritise your budget based on what you actually value, what adds the most value to your life?

How to use the gap =

1 Save an emergency fund first of £1k = this stops the cycle

2 Pay off expensive debt first, if it's over 5% try and pay it off.

3 Save 3-6 months living expenses in case of crisis

4 Start to invest your gap into savings - pensions, ISAs.

@LemonBeagle thank you. I know soneone did rebel finance but it seems very time consuming.

Good idea re getting the gap bigger. So they recommend an emergency pot first? That feels wrong to me, but I actually think I could get 1k relatively quickly.