To be permanently skint, despite being on a good salary?

[cherriesandapplesandberries]

On paper, we have a good combined income of around £85,000, although it varies slightly and can even go up to around 90 on a good year.

But we seem to be permanently skint, and I don’t mean not much money, I mean absolutely nothing in the bank accounts, scrabbling round for loose change, stressing about how we will get to work, skint. This isn’t a begging thread by the way, I know sometimes people post on MN wanting others to offer them money and I don’t, I’m just trying to explain how it is.

We do have debts, loans and credit cards plus obviously the mortgage, childcare fees, cars which cost then obviously the needs of a growing family.

I know back when I was a young ‘un I’d have fallen about laughing at the idea my current salary isn’t enough to live on, but I just seem to be struggling all of the time!

Solidarity with other rich people? If you have no money left with an income of 85k then you are really bad at managing money/living beyond your means/very entitled.

@cherriesandapplesandberries I remember your pension post a while back - I think I commented on it and said you'd be mad to withdraw (I'm also a teacher so understand how heavy the contributions are).

That said, if you are struggling to that extent now, then maybe a short term withdrawal is needed to get you back on an even keel - as long as you have a definite plan to rejoin as soon as you can,

I do actually sympathise - we have just one salary (I'm SAHM) and all the outgoings do add up, especially when children are small. It's not a case of living outside your means, it's rather just hanging on in there until children are older/at school.

There's only so much belt tightening you can do - we (desperately) need a new boiler and are currently visiting ASDA every Sunday afternoon when food is marked down; we get food for the week and the saving goes into the "boiler" money pot. It's a slog, but we'll get there. We just look at it as a temporary situation.

One of you is most likely working just to pay the childcare fee's if you have more than one young child? Are you claiming tax free childcare?

OP if you want to moan about not being able to live as if you are rich in spite of having an income higher than 90% of the population, then go ahead. An income at this level does not allow a rich life.

But I do think you would be much happier if you and your DP learned how to manage money.

Ring Step Change the debt charity, they will help you see where your money is going and offer solutions free of charge.

Probably some of that nurse. Lots of adverts for holidays too that I can’t afford!

YUP I hear that loud and clear.

I want, no, I need a two week holiday in the carribbean, all inclusive, plus a new suitcase and new shoes & clothes, plus spending ££. I have a budget of £300 I'm laughing because the alternative is to cry.

This thing called being an ADULT aka ADULTING is a big pile of steaming poo!

OP - we had a period when on paper we should have been comfortable, but were reliant on DH doing overtime to have any sort of "fun" money. It was only a couple of years, but it felt hard and that you couldn't complain as compared to the average in the UK, we were above that.

Living in the south east does mean you have to lower your expectations about what sort of lifestyle you can have on an above average income for the country.

£85k sounds like a lot, but if it's around £4.5k take home pay, if you are losing £2.5k to "working costs" (childcare and commuting), then your real budget isnt all that much, before you throw in additional loans and debts to make things even less manageable.

I'm guessing you are in that period when at least one child is in childcare before your preschool funding hours can be knocked off the bill, this is painful period but when they hit 3 the price does come down, and it gets easier again when they start school. If you are in a position when childcare costs will fall in less than 18 months, dont quit your job, look at how to reduce outgoings, including trying to get your debt repayments down for this period.

Just let go of the idea that someone with your/your DPs job should have a particular lifestyle.

I'm a bit confused, though I've tried to read the whole thread, OP. You say 1500 of your salary goes on childcare, but also all of your partner's 1700 salary goes on childcare?

I'm a bit confused too about what you want - not advice, just sympathy?
If you have 500 left for food etc then you have my sympathy, but this can this be right on a household income of £50k? Do you meal plan, do you have expensive mobile contracts, buy takeaways ever, have sky netflix etc? Have you cut your heating temperature a degree at least?

Of course it is a temporary problem in the sense of the children. It is a dilemma about the balance of working/not working while children are preschool. I think the Nordic countries do it better. You know it is temporary, you don't think there is anything you can do to improve your budgeting, so in a way YABU to post about it!

Can your dh do more work or take a 2nd job.

Inconsistencies on the thread. You say you are a teacher. £50k puts you in slt. You get home before 6pm if you use your car. I thought all teachers worked 12 hour days!

Not having enough money is pooey and unlike most of MNet I don't think £85k is a great joint income.

Your problem lies with life choices: not marrying someone equal to you professionally, not spacing your children and living beyond your means and failing to plan before children. It sucks but they were your choices and there are only two choices now:

Either your dh brings in more or you both spend less.

I know you don’t want advice but I sit down one a year and overhaul our finances I normally manage to reduce bills by £100 per month.

At the moment you are probably at the point of peak skintness due to a combination of childcare and mortgage

When do you children become eligible for the 30 hours funded childcare or go to school

Assuming you have fixed you mortgage when is this up for renewal? Could you remortgage and reduce repayments when this is due?

Could you look any consolidating all your loans and credit cards into one loan and making the monthly payment cheaper?

Can you go through your finances with a fine tooth comb and cancel anything (if you have not done so already)?

Can you ring up your gas/electric provider? I rang up to ask for my energy usage and they asked why and said they were too expensive! They immediately said that they had a cheaper tariff just launched yesterday (magically) and it saved me £50 a month. Or put your figures into uswitch and switch to a cheaper tariff.

If you have sky/virgin ring up and cancel it. Within a week they will ring you up with a much better deal to entice you stay. Oviously it’s cheaper if you don’t have sky/virgin at all. I pay £45 a month for all the channels plus phone plus broadband (instead of £90)

Never renew anything car insurance, breakdown cover, etc without shopping around and telling your existing provider they are too expensive.

Try to use cashback sites for anything you buy

Can you move your debt around so you’ll be paying less every month?

There’s no point in paying it off quicker if you’re struggling for money now.

When both my DC were under 5 we were paying £1300 a month in childcare, which has now dropped to £300 for the after school club.

DS starts secondary school in Sept so it will drop again.

At times when the DC were young it was hard to see a financial light at the end of the tunnel but thank God I never gave up work like some idiotic posters are suggesting here.

I'm on a healthy salary now, which I would
Not be on if I'd stayed out of the job market. Keep going, it will get better.

It’s temporary though as your childcare bill won’t always be that much. We’ve a combined income now of around the same, (when I go back to work in March...) we’re not skint but have HIGH outgoings.
Nursery and after : before school club 1500, (from March) our bills are about 2500 as we have a high loan payment at the moment.
This is temporary though and won’t be there forever.
We enjoy holiday as we save for these.
I meal plan, we don’t eat out and don’t buy lunch at work. We rarely have takeaway and don’t have many expenses.

We have about 800 left a month- this is for everything - food fuel clothes etc. It isnt forever however just like your situation isn’t.

We changed our mortgage product, cancelled Netflix etc and changed providers for internet and other things which saved about £200

I think op that it would be worth your while spending a couple of hours looking at your projected cash situation in 1/2/5 years, when presumably your childcare requirements will change somewhat.

I’m kind of opposite to you as I have to build up my pension very quickly as I was a SAHM for years and now I’m divorced the substantial pension built up by my ex is no longer available for me (I’m staying in the house so I have that asset but the repayments are huge and have another 15 years to run).

So I am working out how skint I can cope with being by maxing out my pension contribution. I’ve switched energy providers, shop only in Lidl, and note every tiny outlay on my phone. I have a spreadsheet that indicates where in the month all my direct debits go out. I have a credit card, no debt, but I had a lot of medical expenses, and more on the horizon. It looks really austere at the moment. I asked my family for gift vouchers for Christmas (cinema, hair, Ticketmaster) so the children aren’t missing out hugely in the austerity drive, but days out aren’t coming out of my pocket.

I know that I just have to swallow hard now, but at least I can see a path to being better positioned for the long term.

Not sure how your dh is only taking home £1700 on a salary of £35K even if paying into a pension? It should be around £1900 at least - have you checked the tax code?
It would have been simpler if you'd given all the info you've subsequently shared in the first post.

Otherwise you do have my sympathy - general every day life is costly but at least there is light at the end of the tunnel - you're debts are decreasing you say, your childcare costs will reduce and you're paying off your mortgage. You will also be happy about the pension payments 10 years from now. Just grit your teeth and get through. You're fairly young by the sound of it (30's?) so have plenty of time to sort things out. MSE great for hearing how others have fared with debt and budgeting generally.

We have a similar income.
DH is also a senior teacher.
We had 3 DC in 4 years, the last one unplanned. It just wasnt feasible for us both to work as the fees for childcare were as high as my wages.
So I quit until they were all settled in school and then gradually returned and rebuilt my career. I pay AVCs into my pension now but it is back up to the level it should have been at had I continued FT.
We now aim to save £1k per month but remember that even though childcare costs finish for a few years, you will start contributing again once they start uni.
You said you need a decent car because of icy roads, are you driving a 4x4? I think we have only had a couple of icy mornings this year and most basic cars have ABS these days. I would look at something more economical to drive.
Good luck.

You are unlikely to find many people in the same boat because that is a high income to be struggling on and it sounds like the reason you are struggling is due to high debts. Once the debts are cleared and once childcare costs drop you will be in a very different position

@OhTheRoses It is not about personal opinions. I ran this level of household income through a comparison for the uk for a household with 2 adults and 2 kids, and it said that put that household in the top 90% of income. So objectively it is a far higher household income than the majority of households in the UK.

@Lightsabre if pensions repayments are really high around 13/14% this would be correct... police pensions are around this

Once you start borrowing to pay for daily living expenses your credit will start to nose dive.

Money makes money.. if you are rich enough AND savvy enough to ensure your credit is good.. then you would be fine - However once your credit dives you just keep spiralling downwards. Poor credit will cost you a fortune. ..for us it was an accident that set us on that path. DH off work for a year.

This is no doubt one of the things 'costing' you twice as much as those with good credit is poor credit loans and high APR CC's..

I know this from bitter experience. £40k salary and £60k salary and hardly a penny left after payday it was all gone on CCs loans mortgage childcare.

The solution for us was to go to StepChange debt charity. We went in to a debt management plan. (Free, no fees, please don't do this with a commercial business they only cost you more money!!) I had been reluctant to do this because thought it would screw my credit.. but in all honesty, our credit was so screwed it actually improved it !.

It took 2 years, 3 months . The charity contacted all our creditors and negotiated reduced payments and lower interest rates . We made one payment to Step change who distributed the monthly payments. (With exception of the mortgage which we kept outside the plan and just paid them direct. )

Sometimes you just have to stop trying to 'manage' and get some real help.

StepChange .Org where you can set up a plan on line . Or call them. 0800 1381111

I

I feel your pain. Our income is around 90k but two back to back maternity leaves with three kids has led to debt which left us tight. We currently work opposite shifts so are lucky to not have any childcare costs but it takes it toll on our marriage. We sat down at the start of this year to figure out a plan to get things back on track. It’s hard, especially when you have people telling you that you shouldn’t have any money worries on your income. (We live in London so housing costs are enormous as well)

And any car these days can cope with icy roads. But it does betray a certain kind of thinking about what you need, that I suspect is at the root of your money problems.
You don't appear to want to tackle this though, which is of course your choice.

Definition of luxury I guess?

Luxury...having a meal out or takeaway for a birthday ...being able to have hobbies .I play music., that's £15 a week...buying the more expensive but nicer shoes..having holidays ( we camp because I hate to stay in an hotel but I guess that's also a lot cheaper) ...not having to check the bank balance if I want to buy a book and being able to replace the boiler the minute it goes wrong with one that has great reviews not the cheapest out there

All these things make me really happy. What do you think of luxury?

not marrying someone equal to you professionally- wow!!!