To wonder how ppl do it...afford it all?

[wishywashyy]

How do ppl (I mean the average joe!) afford everything? I know, I know situations are different BUT in general
Mortgage
Car payments (usually 2!)
Childcare
Savings
And general living

It doesn't add up
Mortgage/council tax on average would be what? 700-800?
Car payments x2 600?
Childcare (let's just say one lot) approx 1000
That's 1400 alone at least!
Saving? I suppose that's depending
General living? Another 800-1k
So That's 2k
Then there's other bills which would be 500ish
That's 2.5k in total

That's a take home of about 40k! Gone! And no savings!

I'm baffled and freaked out at the thoughts!!!

Also you don't know what help people have from family etc. My lovely sis in law comes from a really well off family (although they're the type with whom you wouldn't know it) and so she and my DB were bought a pretty big house outright in quite an expensive city. It means they have so much extra to spend on their 2 decent-but- not-astronomical incomes that you'd wonder how they did it if you didn't know about the house.

We are in Scotland and I wonder the opposite. What do folk do with all their money. Especially when 2 ppl are working full time in well paid jobs. I'm part time and our combined income is about £42K.

When I was full time I was earning £40K and we cld save nearly £1700 a month before the kids and in a small house. Still used to be lots of nice holidays too. We had £100K saved when we bought this house, put down a large deposit and kept some for refurbishing.

We have 2 cars, 1 brand new leased and 1 is 6yrs old and owned. 2 kids at nursery 2 days per week. 4yr old is mostly funded now but 1yr old, well it's nearly £500 per month for her 2 days a week.

We always go one holiday abroad (pre covid) and some wkends away. My food shopping is higher than average and I spend way too much on nice clothes for my girls. Our mortgage is quite low just under £500 per month but council tax is £260 😡

For the ppl I know that moan about money or don't have much to show for it but earn well. I can only assume they are in debt. U know paying minimum amount and it doesn't even cover the interest. It must be easy to let it get out of hand.

There are 2 groups of people, one group of people live within their means and budget. Some peoples budgets are bigger than others so its all relevant to your household income.
The other group of people are in tons of debt and spend what they like.
Appearances can be deceiving. Don't worry about what other people do and concentrate on yourself.

Childcare is "only" crippling between age 1 and 4. It's a lifetime at the time, but across your whole adult life it's not a huge chunk.

Cars are much cheaper if you can save up and buy outright. A bit chicken and egg I know, but if you can scrape together enough to buy one old banger, it's then easier to save up for the next one. Or at least buy with a loan, pay it off then have a few years running that car for "free" while you're saving up for the next.

If petrol/ diesel are going out of general expenses then I think £300 a month each for cars seems very steep. Running my car costs me less than £2k a year including petrol/ insurance/ tax/ MOT etc so you could halve your allowance for cars and include petrol in that.

£1k for general living seems excessive if you’re also allowing £500 for bills. My bills also cost way less than £500 a month, probably not even half that. It sounds like you are assuming a life with multiple luxuries - obviously if people are on a low income they don’t have expensive days out, expensive TV or phone subscriptions etc. If you’re on a low income you also probably don’t run two cars (maybe not even one) and if you do they won’t be new/ expensive cars.

Also childcare is often a temporary expense until the kids start school or at least the cost of childcare will greatly reduce when only relying on wraparound care and even when children are in nursery there are free hours as they get older reducing the cost. You also haven’t included any benefits such as child benefit, tax credits etc in your calculations.

Yes, for the numbers you have apparently pulled from the sky there wouldn’t be much left from £40k but of course many families have much lower outgoings so this post seems quite irrelevant really.

You budget.

I'm a single mum of 3 school aged kids. My household income is just under £30k, after tax and including child benefit and the tax credits I receive towards my childcare. I do not receive maintenance.

Mortgage is £360 per month
Council tax is £104
I own my car outright
Other bills including car insurance £350
Savings £200
Monthly food and groceries £200
Childcare £500

If the above is your situation, the first thing I'd cut is the car payments. New cars aren't necessary and leases are costly.

Oh I probably spend about £140 on petrol a month too.

You afford it all, by not doing it all at once.

Ie. You buy your cars before having children, so you don’t have childcare costs and car costs running concurrently.

We probably spend up to 1k a month, including bills, not excluding, and that’s feeding adults and teens.

To use a cliche, you cut your garment according to your cloth.

@ilovesooty

bought second hand cars outright You have to have a certain level of income to finance that.

You don't. I do it and I earned minimum wage for years. You have to save up bit by bit for the next car constantly. The budget for the next one is whatever is in the savings pot or less.

@justanotherneighinparadise

Oh I agree. The frittering of money on absolute shit is very detrimental to outgoings. That’s why so many people were flush during lockdown. My neighbour lost so much weight I hardly recognised them. They said it was due to being at home and eating proper meals instead of going to Costa or petrol stations and eating crap on the go. Forgetting the health impact but the cost of eating like that day to day really adds up.

Costa food isn't that high calorie really. At least with that kind of food, the calories are on the back of the packet so you know more or less what you're eating. I bet many more people have put on weight being at home near the fridge every day and never going anywhere.

the ones that are on decent salaries can afford it, the ones that aren't get help with childcare from 30 free hours or Universal credit ( 85% ). Childcare help now is way more generous than it ever was when my kids were small and you can be on quite a decent salary and still get help from Uc if you have childcare costs.
i am friends with a young couple in their mid twenties, one child , just about to buy a 300k house, child in full time childcare, endless days out, holidays etc.

Most families don't afford all those things at once though. Childcare is most expensive for under 3s but similarly your disposable income is highest before you have children so you can save for at least some of this in advance. If you have any flexibility in jobs you can minimise the amount of childcare needed (or many couples literally work opposite hours). Similarly you can overpay the mortgage when you are a couple with no children so that allows you (if you've chosen a suitable mortgage) to reduce payments or take a payment holiday.
We've never had 2 cars - have picked jobs and where we've lived to ensure that we don't need them.

I would say don’t buy 2 expensive cars on finance and then say you don’t know where your money goes! We have two older cars bought outright. We don’t have childcare costs as we reduced hours and worked round the kids. We earn more but live in an expensive area so that might balance itself out.

People do it in different ways-earn more, cheap cars, no childcare, have debt etc

I think the outliers are :
Cars - we don’t have one, and nor do most people we know.
Savings- don’t try to save while you are paying for childcare. I don’t know anyone who had grandparents help with childcare, unless for a few days in the summer holidays.

@ilovesooty

bought second hand cars outright You have to have a certain level of income to finance that.

Well only if you are buying bars 1-2 years old. You can get a ten year old car for about £1000, which most two-income families could save up for.

Bloody hell those are huge car payments. Do people pay that much? (I'm lucky in that I could afford to just buy a car I guess). I don't think most people have a child in full time childcare and they tend to save in advance for when they will. People with lower paying jobs will get help with that cost or simply not work while the kids are young.When we were in lower paid jobs we certainly did spend 800 pm on general living (although now spend much more).

Buying cars in finance is NOT a good idea, especially having two of them. Work things out so you only need one car, and buy when it's 3-5 years old. New cars depreciate ridiculously quickly.

Space DC out so you only have one in nursery at a time, then the costs won't seem beyond you, or alternatively one of you go as part-time as you can for a few years, and make it work between you to minimise costs.

Only buy fresh ingredients to make nutritious food, and don't buy beige for a quick fix, as you'll only need to buy more later to fill you up.

@ilovesooty

bought second hand cars outright You have to have a certain level of income to finance that.

Not necessarily - you can buy 3rd or 4th hand cars for less than £500. Yes, they won't last forever but you don't need them to. You keep them until they break and buy another one with whatever you have saved at the time.

I don't know anyone who has a brand new car or a lease car. Everyone has them second/third/fourth hand - either from a garage or private sellers.

And yes, we have no car, and childcare costs are currently £650 per month with 30 free hours, and will be going down to £200 per month once DS starts school.

I think a lot of the time the person assumed to be an 'average joe' earns a lot more than the person thinks they do.

Dosent mean it's all paid for... some folk have to juggle credit, some have handouts from family.
Never know what happens in someones finances.

I know about 2 people that have outright paid for cars. I have a older car circa 3k. But it's paid for, that's my priority, others are happy to pay lots a month on finance just to drive a New car... jokes on them I think

People don’t “afford everything”.

They prioritise unless they’re very well off.

The lifestyles that you see portrayed as “average” in the media are anything but.

Obviously ppl do it, working families of 4-6 kids with incomes of £14-£18k do it.

Rent from housing association benefits include DLA for SAHP (kids do a lot of caring for parent some times of day) so no childcare costs, working parent has low wage job within walking distance. Old car they drive minimally. Holidays in borrowed caravan every other year < 1 hr drive away, 3kids in a bedroom, kids get own paid jobs asap...savings, ha!

You just don't overspend, live well within your means.

I am on a single income of under 40k and have children. I rent (reasonably cheaply), drive a car, have wraparound childcare and am responsible for all my bills. I don't count every penny, but I am very much aware when I need to tighten the belt. I also put money into savings each month for bigger outgoings like my annual car insurance renewal. I drive a cheap and cheerful, 12-y.o. car.

Our days out are walks in the local-ish area, picnics, maybe the odd farm. Kids are entertained by old-fashioned stuff like board games, which, after the initial outlay, cost me exactly nothing. And I have a teen, too, so it's not just a case of "they don't know". I cook from scratch and use local and seasonal produce.

Two things are really important here:

I don't give a shit about status symbols, so really couldn't care less about being seen to drive an old banger, wearing last year's clothes or having a no-name phone. Therefore I also try to repair over replacing items needlessly.

While I allow my children to embrace new technology, I have also taught them things my parents and grandparents would have done for fun, therefore explored their own interests with them and brought them up to value books and family games. So neither of us feel the need to compete and it's quite funny to watch how their "cool" friends enjoy the novelty of playing something old-fashioned when they come and visit.

I’m always flabbergasted how people manage tbh. I have a good salary but my mortgage is huge - probably that’s my problem!