To not be sure how we never have any bloody money?!

[ThePinkGuitar]

I know lots of friends that earn the same or bit less that get to have holidays aboard, lots of days out beautiful home.
We are nearly at the end of renovating our house but no money to finish it off. Dh earns 40k plus does lots of side jobs so probably on average another £150 pm. I earn 28k (22.5 hours pro rota).
We have 2 children never have been able to take them on fancy trips. We don’t wear expensive clothes, no cosmetic costs (dye my own hair and use Rimmel make up lol).
We have an average car, pay 1k a month mortgage. We spend a lot of groceries.
But seriously where is all the money going I genuinely do not understand?!

OP, this is the right time to get a grip on your spending and do some actual budgeting.

It's good that you have done the essentials of renovation, but make paying down your debt a priority now. It really isn't necessary to refresh furniture 'just because', and I am astounded by the kitchens and bathrooms that are condemned on M on 'look at this house' threads as 'needing' a new kitchen. We are in a frenzy of marketing-driven spending.

Make budgets and stick to them. Do your budget, budget to overpay your debt. Take money out of your current account and put it into a savings account when your salary comes in - not at the end. Just a small amount until your debt is paid.

Think beyond money in your purse. If your DH spends £10 a day at drive thrus and coffee shops, that's £2,400 per year if he does it 5 days a week.

I think your grocery bill is very high. Meal plan, take advantage of offers and put things in the freezer, etc.

You seem to have the impetus, and once you start to see even a small change and feel more in control of your money and life, you get even keener to improve.

Good luck!

If you really want to cut back you'll be surprised just how much you can. Depends on how much you want to. Have something in mind to aim for. Holiday, car, posh frock.

You are effectively paying total tax and NI of 62% on that top slice of £10,000 and only taking home £3,800 of it

Hmmm.

Someone earning over £12.5k and claiming universal credit will lose 32% in tax & NI and 63% of what's left will come off their UC. So and extra £100 a month in gross pay will give an increase in net pay of £68, which is offset by a reduction of £42.84 in UC.

Earning that extra £100 will give them a net gain of £25.16, equivalent to a marginal tax rate of of 74.84%, quite a bit higher than the marginal tax rate of 62% of the person on the 6-figure salary.

Quite why the poor need to keep less of the money they earn than the rich is a mystery to me.

@peepercountry

Do people really think 1k is a big mortgage? I guess most who do are over 40 & not in London.

I'm over 40 and it doesn't seem big to me, because I can remember the days of 15% interest rates.

We had to take out a £60k mortgage in 2013 to pay my divorce settlement. It was £420 a month, because we could only get a 12-year term because of my age. We paid it off after about 3 years, by overpaying and cashing in as much as possible of my pensions.

It didn't seem like a lot, because I was supporting clients paying more than double that in rent every month for the same size property. The rent for a 3-bed house in the private sector here is around £1,300 a month, so £1k on a mortgage doesn't seem like a big deal to me.

@peepercountry

Do people really think 1k is a big mortgage? I guess most who do are over 40 & not in London.

It's absolutely huge to me. I'm only 31 but I don't live in London.

Our mortgage is less than £300 a month.

My first mortgage was £125 per month but the council tax was £90 because up north we pay alot more. That was the lowest band too

I then got a mortgage which was £200 per month, I thought it was massive, council tax £90 and that was with single person allowance

I wish my mortgage was that low

We only have a tiny 2 bed cottage, put a 30% deposit down and it’s still just shy of £1000 a month
And it’s for 30 years! 😭

And I was think we were the lucky ones at it’s locked in at a super low rate of 1.79% for the next few years

It’ll be extautionate if the rates rise by much

Not to mention the damn council tax. They’ve put it up by over £10 per month each year for the last 4 years

Was £130 a month now £170 a month

Ouch

You can have a mortgage that's considerably lower than £1000 pm. It's easy, all you need to do is buy a house in a cheaper area.

Your 30% deposit would probably buy a house outright, leaving you mortgage free, in many areas, if the remaining 70% of the expensive house you chose to buy is taking 30 years to pay off at nearly £1k pm for 30 years.

Go to your banking website and download last month's statement as an excel document.
Then categorise everything.
Everything.
Mine are:

Bills
Groceries
Savings
Takeaways
Travel
Subscriptions
Clothes etc for me
Clothes etc for kids
Going out/related (eg lashes, nails etc)
Online shite (my biggest waste of money)

You'll soon see where your money is going and you'll be shocked at how much is wasted.

I admire you @ThePinkGuitaryou for admitting you aren't great with money and this thread has helped you see what you could do. Sorry if I was snippy to you, I'm good with money as we've never had much and I should realise some folks just aren't. As you said it's a good lesson to learn, it should be taught in school.
Good luck with this, I'm sure you'll be OK and will see a good improvement soon.

Thanks @ssd I appreciate that :)
Please no need to apologise I think I need I needed a virtual head wobble and this thread did that. I just hope I’ve not upset anyone who is actually struggling at the moment I need to be mindful going forward.

I'm sure you didn't upset anyone but everyones circumstances are different, I guess we all need to live and let live a bit. Of course, most folks are a bit edgy and over anxious just now anyway, I know I am, and I'm pouncing on folk here a lot more. I try and apologise but I should be more mindful.

I guess none of us are perfect!

I am

So am I really

I really got a shock at how bad some people are with budgeting. I agree it should be taught at school that and cooking, sewing, basic woodwork house maintenance. Just a few lessons on each. I have friends who cant sew a button on, change a plug or hang a picture.

I really got a shock at how bad some people are with budgeting. I agree it should be taught at school that and cooking, sewing, basic woodwork house maintenance. Just a few lessons on each. I have friends who cant sew a button on, change a plug or hang a picture.

I did ALL of that in school!! Do they really not do any of it in the U.K.!??? I'm 36 so not that old!!

ssd well maybe not so much now, my fella said I used to be stunning but just normal now! Cheeky bugger

I did cooking sewing but not allowed metal work, woodwork cos I is a girl. Not taught budgeting. Not sure what's taught now as children dont seem to know basic stuff

I could be wrong and schools may do this but if they do, need to do it better

@kittykat35

I really got a shock at how bad some people are with budgeting. I agree it should be taught at school that and cooking, sewing, basic woodwork house maintenance. Just a few lessons on each. I have friends who cant sew a button on, change a plug or hang a picture.

I did ALL of that in school!! Do they really not do any of it in the U.K.!??? I'm 36 so not that old!!

I did all of that except learn how to hang a picture and am also 36.

My children have done basic cookery and learnt how to sew a button on, but that's all. Most plugs are moulded these days so can't be changed easily. Not sure if they've done woodwork in DT. I've taught them loads of home maintenance and cooking at home though.

You could try giving you and your husband set amount every week for stuff your preferred stuff. Set amount for food and stick to it, no more dipping in.

Op I would suggest talking to Next Step a debt charity. I don't want to scare you but I think your income is fairly low, your mortgage is very high and you have a sizeable debt, all of which is the perfect storm for a financial crisis.

It would only take you or dh to loose your jobs and you'd be in trouble within a month.

Next Step don't judge they just spend hours with you helping you go through your income/outgoings, debt, assists etc.

They helped me and my family out a couple of months ago and my debt management plan starts in December although we have already made lots of progress in cutting costs and tackling debt.

I think you would really benefit from some specialised advice.

To give you an idea op, we moved for a cheaper mortgage - ours was similar to yours at 1k and now it's £600. We have other factors going on but we were still struggling because I lost my job.

Looking back we could NEVER afford that first mortgage and I regret ever trying to live that live. I was like removing a chain from our necks when we moved.

We also did renovations and it was beautiful when we sold, so we did ultimately make money on it before moving to a house a third cheaper and a proper shithole. We are very happy in our new home and glad to be shot of 'the dream'.