To wonder what's going wrong with our finances!?

[pondering12345]

In the process of moving to a joint account with DH, so using this opportunity to review our monthly finances:

Income
DH take home pay £2600
My take home pay (part time) £1075
Child benefit £145
Total income £3820

Expenses
DH car loan £270
My car loan £160
Mortgage £645
Water £60
Gas and electric £250
Home insurance £15
Broadband £25
Council tax £190
DH credit card £110 (we each use our own credit card for any purchases for ourselves and pay off the following month)
My credit card £100
My phone £35
DH phone £35
DH car tax £20
TV license £15
Zoo membership £20
Apple Music subscription £15
DH contact lenses £40
DH haircut £15
My haircut £20 (£60 every 3 months)
My nails £30
Window cleaner £15
DH petrol £100
My petrol £100
Food £450
Takeaways (one per week) £150
Kids hobbies & swimming £100
Date night £50
Disposable income £500
Total expenses £3535

This leaves less than £300 per month to put towards tonnes of other expenses - annual car insurance, gifts, Christmas, holidays, kids clothes, home and car maintenance etc.

Where are we going wrong here!? I don't feel like we live a particularly lavish lifestyle.

Apple music? Who still uses that? Spotify the way forward there.. Not a big saving but a mindset

Then cut down on takeaways. And your cars are very expensive

@pondering12345

Just did a turn2us calculation for you and partner based on you earning £13,600 and partner £41,000 gross.

Shows you’d be entitled to about £36.25 universal credit (based on your rates being circa £1800 and 2kids)

That’s £1885 per year.

Obviously you’d need to input your own details exactly but it struck me you’d be entitled to something with the income you have.

£36.25 per week

Here’s the calculator

benefits-calculator.turn2us.org.uk

I do, it works better with all my Apple stuff.

We're on 100k+ and I clean my own windows and paint my own nails. We also don't eat out that much, maybe a take away once a month. Granted, also because we don't think it's healthy but we both can easily cook from scratch.

Your lifestyle sounds really fun! I'd like to live like that for a month or two, just to see how it feels....can't imagine getting a takeaway whenever I feel like it, nails done regularly...I've only had my nails done professionally twice in my whole life!

I think OP said she is still in her 20s...lots of people don't have a budget at this age and you've plenty of time to save for retirement. Writing down your current expenses is a great start. Once you know your outgoings you can decide what to prioritise. Only you know how essential things are.

A PP suggested using the Moneysaving Expert site to write a more complete list of your outgoings and formulate a budget. This would be a good next step.

As you get older I'd imagine you will want to put more aside in savings and mortgage overpayment. We overpay every month and should have it paid off in 5 or 6 years if all goes to plan.

To me the car and phone payments really stand out...we just have one secondhand car which was bought outright with £9000 savings, I commute to work which is £50 per month. Phones we bought outright about £100 each, pay about £7 each a month sim only.

Our combined wage is about what your husband earns., but we have no kids. We do live fairly frugally...only have one takeaway a month (you can always use supermarkets to make a 'fakeaway' version), use Aldi and don't really have a 'date night' as such...we do lots of cheap days together like going for walks, Wetherspoons, Meerkat free cinema tickets. You don't need to cut back to this extent, but it's worth considering what you really need.

For example, £100 on kids’ clubs seems really cheap to me - I have 2 DCs who are teens

Well yes, club for teens can be expensive especially if they are getting serious about an hobby or doing something like music lessons.

It's not really comparable to clubs for a 1 and a 3 year old who are presumably doing things like toddler groups. And would in any case be perfectly happy with a run round the park and don't need masses spending on "activities".

*commute to work on public transport

Do you realise there many people here with zero disposable income and zero saving capacity?
Id start there.

Universal credit with a combined income of nearly £55k?! Surely not.

And if so, this thread more than proves it's not needed.

I don't know why people keep saying that OP and her DH are badly off. They are on pretty decent salaries, and there is no way they would (or at least should) be entitled to benefits. OP's DH will certainly be earning more that £41000, for example, unless he is paying no pension or student loans, and I think OP has already suggested he at least pays basic pension contributions.

@redskyatnight OP earns about 13k a year. That’s what I earned 13 years ago aged 18 after Sixth Form. It’s a very low wage, even for part time.

@washingwakeup @redskyatnight

If you have one child then unlikely to be entitled to UC on that income. With two they will probably get something.

Remember UC is taking over from tax credits.

£2,600 a month for her DH net is £3,418 gross; £41,011 pa.

By the way I didn’t include pension contributions in calculations as didn’t know what they were. If they contribution to pensions that will reduce their net income so UC due would be more. And then more again if they have any childcare costs.

Everyone ought to check their entitlement.

The maximum income threshold is often higher than many realise. We have a higher income than that and if we didn’t have savings would be entitled to UC. Admittedly we would have disabled child elements and carer elements, but we wouldn’t have a housing element.

However, I don’t think OP would be eligible for UC:
Standard element - £525.72
Child element x2 - £244.58 x2
Total = £1014.88
Earnings minus work allowance - £3675 - £573 - £3102
£3102 x 0.55 = £1706.10

That was my first thought. If I had that kind of money I'd class savings as a monthly bill before I calculated any other expenses.

It's ok to have someone else do your nails as long as you're happy to spend your money on it. Op isn't happy with her money spending, and that's one easy thing to cut back.

Yeah I'd be surprised if they are. My husband earns slightly less and I'm on Carer's Allowance. We have 4 eligible children. We're entitled to nothing extra.

I'm shocked.

Once I hit about 31-32k, I wasn't getting anything apart from CB.

Yes, I'm single and have only one DC, but I don't see that having an extra adult and child warrants UC if you're earning £22k extra PA.

It’s better to take a bigger mortgage and be building equity in an asset which will increase in value

This is a weird take, which is a shame as there was some reasonable advice in your post otherwise wombatchocolate. There's nothing inherently positive about a bigger mortgage and high housing costs. You have to live in your house as well as think about how it works as an asset. Perhaps OP and DH live somewhere cheap and like it? Perhaps they live close to family, hence the lack of childcare costs. By all means advise people to reduce spending on treats and pay off a mortgage sooner, but that's different to spending more on housing simply on principle.

There is some good stuff on this thread but some of the assumptions are a bit daft. I think with OP being fairly middle income she's attracted it from both sides of the income scale!

Unless the OP does live somewhere expensive and was given a massive deposit, that would appear to be more about location than luck. Your son's twentysomething mates could choose to live and work elsewhere, and if they haven't it's presumably because they feel the benefits of being in London outweigh the costs.

I have my window cleaner come every 6 weeks. He says that some of his clients have their windows done every other month.

You are having a lot of fun on that budget- date night+ takeaways+ credit card+ personal spends+nails is a lot. (I'd argue that hair is a work thing but if you have a straight forward style then worth trying hair colleges- my local one is very cheap) I would try and combine the date night+takeaways+personal spends amount+credit card into a smaller figure because that's where the most savings could be made. Do you have a credit card with some sort of bonus points ? Might be worth boosting your Nectar balance or similar at the same time?

Unless your DH has a complex prescription / other issues, Specsavers do monthly contact lenses inc solutions for about £15/month.

We have a takeaway about once every six weeks. Could you get an M&S curry or similar?

Likewise, professionally-done nails are another luxury. I’m not saying you don’t deserve these things. And one by one they’re not such a big deal. But if you want to save, you can’t have ALL of them.

I would look to reduce the cost of your social life too, which I would guess is where the £500 is mostly going.

Your DH‘s credit card bill isn’t an expense by itself, it’s a bill. What’s he buying?

The You Need A Budget website is very good

By all means anyone feel free to use the turn2us calculator, it’s very accurate.
benefits-calculator.turn2us.org.uk

The crucial thing is this this is the crossover from tax credits that is leading to them being due something. This isn’t like income support or anything means tested. It’s them getting their tax back as she is a very low earner and they have 2 kids.

• by the by if they have savings over 6k then it could skupper getting anything. But I’d imagine they don’t have any significant savings with such enormous car loans.

@pondering12345 you actually have a lot more disposable income than £500 though, disposable income is that which isn't required for essentials, e.g., housing costs, utilities, etc.

Even with the £300 you're left with, that's actually £800, and then the date night, takeaways, nails, music subscriptions, etc., should be added to that aswell, as you're choosing to spend your disposable income on those things.

But as PP said, on your incomes, I personally wouldn't be spending the amount you are on cars either.