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.

What is it you're actually complaining about? You have £800 disposable cash after paying EVERY bill and even have 'fun money' things in your budget i.e zoo, nails, date night, takeaways. You don't even need to cut anything out, you'd still have £800 a spare. I'm struggling to actually see what the issue is exactly.

From your list the most obvious saving would be takeaways. Just buy supermarket ready meal deals if you want a night off cooking - you can get get brilliant curry night or Chinese food deals for £10-15 for two people. That would halve the expense and taste just as good.
I'd also renegotiate phone contracts to save a few pounds and do my own nails. With those tiny changes you could easily save £100 a month.

have a think about why you're spending so much on 'showy' things and not the background stuff you actually need to feel safe and secure.

This is such an important point!!

What goes on the credit cards?

You say it's not a lavish lifestyle but running two cars is pretty lavish, so is having loads of takeouts every month, nails done, zoo membership (though if you go often, that's hardly expensive etc. You life a good life. You have lots of luxuries there. Maybe enjoy them more.

Or maybe vary things a bit. DH and I, early in our marriage decided to stop going out to average restaurants every week and instead went to a really good restaurant once a month. You could cut out takeaways for a month then use the money towards a big expense you need or have a great day out.

Surely car insurance should be in the list as it is compulsory rather than nails which are not

OP, I will go against the public opinion here and say that yes, you don't live a particularly lavish lifestyle. You didn't include holidays or dentistry/medical care, for example.
Competitive poverty on mn is a fascinating thing, everything that is not living on bread and water and walking to your 100 hours/week job is extravagant. It is ok to have nails done and hair cut, and to enjoy an odd takeaway.
You both are just not high earners, and that is ok.
I assume the reason for part time work is children at school? Would you be better off paying for childcare and working full time.

Op I’ve thought similar to you in the past. When I actually went through the bank statement line by line it’s actually all the little £20odd amounts that add up to more than you think. We sometimes fritter an obscene amount in a month and have nothing ‘big’ to show for it. When we’ve really stopped buying stuff spur of the moment for a month it’s been amazing what we’ve saved at the end of it. Go through and itemise that £500 disposable income and also your previous months credit card statement and you’ll know where your money is going.

OP, your car payments, petrol, insurance and car maintenance(s) are probably in the region of a grand a month. Not a judgement, just an observation.

Sit down and work out the full car costs properly. Include everything: all insurances/memberships, valeting, car washes etc. Then think about exactly how much you each need to run a car alongside that £1100+ worth of unnecessary expenses a pp pointed out. They may in fact both be essential - but you need to fully aware of the annual and monthly (rising) costs.

D’y’know what, I’m going to go against the grain and say YANBU

I don’t think it’s that lavish. What’s the point in working if you’re not living? I’ve got a mate who’s moto is “money’s for spending” and I quite admire their freedom. But, I personally wouldn’t be so comfortable without a cushion.

My one suggestion to you would be to open a new saving account. £500/month goes straight in there before anything else to cover holidays, birthdays and one off expenditure like car maintenance, annual insurance renewals and little emergencies. Then see how everything else feels

We're in a similar bracket with similar housing costs and feel quite comfortable. There will be efficiency savings here and there, but I think the big thing here is the multiple car loans and the weekly takeaway. Those between them add up to nigh on £600. We don't have those and there's the difference. You're also always on the catch up with the credit card, you can afford the expenditure but you're paying for last month every time.

If you want to feel like you have more of a buffer, the savings you can make now are likely to be the takeaways, date night and nails. And drive less. Going forward you'll want to do things like renegotiate phone contracts for cheaper ones as and when your deals expire.

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

Surely many if these should come before pricey haircuts and nails? And subscriptions?

Your mindset is mixed around.

2 car loans?!

You are spending most of your money on cars. I don’t understand the current trend of purchasing expensive cars on finance and paying interest etc I think people should get an affordable car. In the past families would share one car. I doubt you want to hear it but you would save a lot of money and benefit your health and the environment by sharing one car.

I was going to say!

I do think OP has quite a lot of disposable income but because it’s been allocated to pots already – hair, nails, takeaway – she’s not seeing it as disposable and is perhaps viewing the disposable as more unexpected spending, eg “shall we go to this museum with the kids? Oh and the gift shop and the cafe and an ice cream”. But that was covered in the first couple of pages then the competitive stinginess began to creep in:

“You spend £40 on a takeaway? Impossible, I feed a family of five for £6, but only once a year” etc. £40 a takeaway is easily done in my neck of the woods, but serves for leftovers the next day too. (Just once; it’s not a Mumsnet chicken.)

OP, there’s so much money floating around in your OP, you just have to decide what to do with it: if you want to finance holidays and Christmas, allocate that £500 spending money to a savings pot. If you want a rainy day cushion, cut back on the nails and takeaways and haircuts.

Personally I wouldn’t cut the contact lenses but that’s only because my DP has uniquely terrible eyesight and gets awful headaches if he only wears glasses, and the lifestyle bonus of having him fit and well 24/7 is worth the price of his extortionate lenses. I also get migraines and scratchy eyes and spend a fair whack on contact lenses because it’s a comfort factor, and also: it’s your eyes! It’s one place I wouldn’t cheap out.

Nothing going wrong
Aside from neither particularly high earners 🤷‍♀️

OP goes out for multiple meals every week, has two cars, has take away once a week, some how spends around £150 a week on 'disposable income', kids go swimming, have zoo membership, a window cleaner, gets her hair cut more often than most, nails done every few weeks, still has a fair few hundred left over spare... And she works part time.

Fairly lavish to me....

I can't see anything wrong with OPs spending if she wasn't on MN asking for advice and wondering where it was all going, OP asked and people are telling her. I spend a lot on non essentials but am not here asking for advice, if OP dropped some of the discretionary spending she would have more left over.

its the cars that blow my mind. We take home more than 3 times what you do and have a 10 year old Volvo, bought when it was 4 years old. It takes us from a to b fine. Why spend £500 a month? What that all about???

What are your kids' hobbies? Disclaimer: i live in a foreign country where everything for kids is subsidised. 100 a month seems eye wateringly expensive!

The zoo also seems a lot. Unless you go every week?

Please tell me you have life insurance because it’s missing from that list!

And I would agree with the takeaways, they are an unnecessary expense. DH and I are high earners and we rarely have a takeaway. If we want a lazy meal night we buy one of those Chinese or Indian meal bags from the supermarket. The kids love them and they are far cheaper!

I guess the both cars are new and on a PCP, a lot of people do this for show, to have 2 new cars on the drive

If you only spend £100 on petrol in each car I can’t imagine you actual use it much. Then the loans are very expensive for something you don’t drive a lot. Could you consider one car?
You are blasting through thousands of pounds in unexplained disposable income so I would halve that.
Also halve the takeaways.

I’d cut the takeaways - you’re eating out with friends so this is a waste of a treat imo - and stop spending on credit cards. Agree that hair and nails should count as part of disposable income. Your hair is very inexpensive though so I think you do well there.

I don’t necessarily agree that the kids swim lessons and hobbies are a nice to have, I would have given up a lot before stopping things for the kids. Ditto haircuts and window cleaning. You have to look tidy for work and I hate ladders. You can cut back without going mad.

I don’t think it’s that lavish. What’s the point in working if you’re not living?

Bloody hell, what's your definition of lavish then?

They spend nearly £500 just on car payments - not including tax, MOT, insurance or things like new tyres.

They spend another £600 on food and takeaways, not including the multiple meals out they have each month.

£40 on contact lenses, £20 on zoo memberships, £15 on music subscriptions, £30 on nails, nearly £50 on haircuts (they don't even include the DC's haircuts in that budget) - that's a huge amount to just fritter away on "stuff".

It's not competitive poverty to say that that's a pretty lavish lifestyle for a family that isn't actually earning that much.