Do our household bills sound reasonable? What could be lower?

[itsalentilsone]

Just two of us (me and DP) living together in a 2 bed flat in South East. I am currently a student but that will be coming to an end in the next 3 months. We are trying hard to cut costs where we can and have been going over our finances to see where we can make savings. Any thoughts on what looks expensive or unnecessary would be much appreciated. Thanks!

Income:
£4,067

Monthly outgoings:
Mortgage - £765.65
Mortgage protection insurance - £47.63
Help to Buy loan - £93.24
Service charge - £188.32
Gas - £55
Electricity £42
Water - £18
Internet - £40
Mobile phone 1 - £18
Mobile phone 2 - £22
Council Tax - £159.37
TV Licence - 13.25

Groceries - £240
Train travel (DP work commute) £477

Petrol - £60
Car payment - £238.74
Car Insurance - £59.32

Netflix - £10.99
Amazon music - £10.99
Oura ring - £5.99
Apple storage - £3
Private / misc payment - £150

Savings direct debit - £160

Do you need the income protection insurance? A lot of people are over insured - check work benefits first before adding insurance.

For exmaple I don't bother with life insurance as I have no children and my work death in service benefit will more than pay off our mortgage.

The eating out and extra spending is where you are likely to have to cut back I'm afraid if you are getting to the end of your money before the month ends.

I can't really see anything else really obvious, except car payment and that ring thing that I haven't heard of before. Seems and awful lot of money per year for a fitness tracker. I'd get a cheap Fitbit second hand and use that instead.

This!

£160 is a random amount to save. It’s also quite small considering your disposable income. Can you increase to £250?

Service charges are ridiculous
I'm in a 2 bed in the NW and pay £200pm

Are you paying a car loan or a pcp? If it’s a loan then the cost will end at some point and you’ll have the car. If it’s a pcp see when you can change it without penalties and either buy a car outright or get a car loan

You have £1k plus unaccounted for ever month.

You need to set yourself a "fun money/treats" limit every month and when it's gone, it's gone.

Messing around will the small money seems crazy when there's such a big unaccounted for money issue.

Also,if you are really struggling to account for it, put the extra £1k into a immediate access account at savings account as soon as you get it. Then everything you take out becomes a conscious choice rather than a passive purchase. People tend to spend current account money quicker than savings account money.

Do you pay council tax over 10 months? Most councils will let you pay over 12 months if you're not in arrears. You won't pay less over the course of the year but it will spread payments thinner.
Does your water bill include sewerage? See if your water company provides water saving devices if you're on a meter. It will reduce both the water and the sewerage parts of the bill. Also look at social tariffs and non return to sewer allowances.

Is that your electric a month? Mine is £50 a week in a tiny two bed. Don't get me started on the cost of hearing oil!

Exactly. That is the problem. We have not managed to find a more economical way of saving / backing up our very many photos and documents. I am all ears though if anyone has any suggestions!

Yes, per month. Ouch - yours does sound very expensive!

Your broadband looks a bit on the high side. You should be able to get it down to £25/26 if you aren't still on a contract.

Can you make your car cheaper at all? Is that HP or PCP?

At the ripe old age of 43 i just found out about 50:30:20 rule for budgeting. Found it useful when trying to figure out how much to save.

50% of your income on essentials
30% on stuff you want
20% save

Of course need vs want us tricky. But 20% saving is useful to me.
I'm not too sure if saving say for a holiday should be in the 20% 'saving' or 30% 'want' so I'm still sort of working on it. But it's at least a guide.

Interesting! Also recently learnt about this. Going to work out our ratio / split now. Problem is that I think our essential costs are already way over 50%.

It is PCP. Not much scope for making it cheaper unless we sell the car and that is the only thing that DP is not currently willing to budge on.

Yes we currently pay council tax over 10 months but will definitely look into spreading the cost over 12 months - thank you for the tip. Also useful info to have Re water bill, something else for me to look into.

@itsalentilsone not asking, but if the private payment of 150 is debt/credit card you'd be better off paying that off than saving 160. You can get a cheaper Netflix. I wouldn't have the music and I wouldn't pay for apple storage. Dont know what qura ring is.

Mine are. But I figured need vs want us sometimes debatable.
Like money for kids to buy lunch - essential? Maybe, but I could make them packed lunches but I don't want to!

So I've accepted some of what I have in essential probably isn't.
But as long as combined it isn't more than 80% I'm ok with that.

It isn't a credit card or debt. We don't use credit cards (at the moment, although have in the past). Heading towards binning off the amazon music subscription. £100+ per year is too expensive

Yes that makes sense, and I have come to the same realisation. Strict essentials puts us at around 50% but more realistically it's around 62% I think. Got to have some semblance of a life after all!

My only real notes are:

• consider the subscription/streaming services you have and if you need all of them.
• I’m sure you could get your internet at least £10 cheaper if you’re out of contract. Sign up to a service like Topcashback and use their comparison tool. We did this to switch from Vodafone to Sky last year and got something like a £60 voucher from topcashback and a £74 cashback from Sky, as well as reducing our bill by £8 per month. Before you buy anything online, see if the seller is on Topcashback.
• be wary of swapping your car for a runabout as PP have suggested. Used cars are pretty expensive at the mo IMO and you could be out of the frying pan and in to the fire in terms of repairs etc.

Smarty did a £16 pcm for unlimited data, unlimited calls and unlimited text and unlimited tethering with up to 60 days EU usage as UK. Check if it's still available. I got this deal in early April.

exactly
why quibble over £5 a month if you're spending £1000 on discretionary stuff, £250 on a car and > £460 on train

Have a look at Giffgaff for a SIM only deal, you can vary it each month if you're not using it all

Have a sim only deal!