Exhausted with current situation - money issue

[Dreambow]

I don’t really know what to expect from this but please be kind.

We are a married couple both in professional jobs (doctor and DH works in the city - not a banker).
I have been contracting the last few years as NHS salary doesn’t cover enough outgoings.
We have a 2.5 year old and a 8 week old.

All we do is work work work. The cost of everything is eating up everything and we have several credit cards (interest free). We live frugally as we can but our outgoings are huge and have increased so much over the past two years. I am so worried that this is going to get worse over the next few years.

We have a large mortgage as live in London for DH work - since the rate of interest has gone up we are now paying £1200 per month extra. Still better off in the long run than rent and we are grateful for this.

Nursery fees were £1050 per month in Jan 2022 and now £1600 (£550 per month increase) for full time. This is for one child (not eligible for government help). Absolutely dreading when the second one starts nursery and when they go up again next year. This is for a cheap nursery - most are £2000 per month for one child full time.

On top of this energy bills and food bills all increased. We have a Victorian house and it’s freezing cold (apart from the ground floor which has underfloor heating). Currently 10 degrees in the house (not ground floor). No insulation (apart from loft) and heating bills are huge so try and turn off as much as possible but harder with children.

We never go out, no date nights (babysitter plus cost of going out would be too much. No coffees out, no meals out, no cinema. No holidays. Clothes from Vinted.

Our living costs have increased by around £2000 per month including increased mortgage £1200 month, increased nursery fees £550 month, energy and food bills etc

For the past two years I worked every weekend (apart from Christmas and Easter) and 2-4 days in the week. Some of my work is adhoc so unpredictable with childcare and have to put DC in nursery for full time.

I feel like we are working a lot harder but wages are not going up. Our outgoings have increased by £2000 month over the last two years but our lifestyles are much much worse.

We used to be able to go out for coffee/ meals/ cinema dates comfortably. We used to go on holiday a lot. We were able to buy high street clothes without thinking twice. House is currently freezing cold and on top of it all we also have a mouse problem (coming in from next door).

I know we are in a better position than some but I feel pretty down-beaten and exhausted with it all. I think inflation will back up again next year and I am not sure how we will financially and mentally manage it all.

To expect to have a better quality of life, working full time and working hard?

@MyOpalViewer if I wanted to mislead you I would clearly name change. I only have a few posts on here and do not spend all my time on here.

We looked at properties over the million price a few years ago but then decided not to overstretch as we were planning on starting a family. It’s still a big mortgage to us as we do not have a lot of equity for a London property (no family help etc) so have had to borrow. Even though I totally get it that it’s a lot compared to other places in the UK. London prices are expensive and we are very lucky we have a mortgage.

I have been up since 01:30 with a small baby. I have been very stressed so that’s why I started the post and I have been checking it all day to see what people have said.

Me again, the person who said about moving to Scotland haha.

I'm intrigued by the can't do his career outside of London, are you sure there is nothing comparable in Glasgow, Edinburgh or even up in Aberdeen.

I know you said he's worked hard for it, but life is different chapters and this one for you all sounds like its run its course or about to break you. Something needs to change surely?

I'd lay out various potential paths you could take including your current path and have a serious think.

In percentage terms how much does your mortgage and council tax combined take up of your income?

Yes, I live in Bromley and most commute into London. Reliable transport and quick, And cheaper than further in London. 🙂

Your house is absolutely massive though OP (sorry that poster piqued my curiosity). No wonder it's expensive to heat. I'm amazed anything that size was under a million recently, wow! But you could absolutely downsize within London and maintain your lifestyle. It seems a little sad to have 5/6 bedrooms in London, but quibbling over a £10 baby class. Is it worth it?

Just had a nosey as well OP, and whilst I have sympathy with the COL rises you have 4,000 sq ft house - that is well over double the size of my very nice Victorian terrace. You also say you did well out of your previous property, so I don’t understand why you have so little equity??

You have choices and options but I don’t think you want to make them.

Mumsnet can be so chippy about anyone earning over £10k or daring to have a house that's over £1m - that's not a mansion in London by a long stretch.

So what if the OP has a big house and they earn good salaries? The point is that she didn't expect her mortgage to go up that much, none of us did! Doesn't mean any of us have to be happy about it.

@allmybooksarefromthelibrary it is a larger property. Less equity as we needed to take money out to do it up. Hence why we didn’t overstretch when we brought it.
Obviously we knew this when we brought it. It was all affordable at the time.
Energy was also more affordable. Our previous Victorian house seemed to retain the heat a lot more so we stupidly didn’t think it would be such a problem with this one.

@ThunderLeaf haha you really want me to move to Scotland! For the record I love it there apart from the rain! Don’t want to say if that’s ok as it’s a small world and ousting.

If nursery is that expensive you’re probably better getting a nanny for both of them? Personally we couldn’t have afforded nursery fees whilst on maternity leave so I had them both at home.

Thank you @TheSecondMrsCampbellBlack . I do feel like some PP are highly critical if anyone dares to earn well. I feel like I have to justify myself for earning well.

Yes the whole point of this thread is I can’t believe mortgages, childcare, food, energy have increased so much in two years. I am worried that this is going to be an issue for the next few years. I think I am a bit shocked that the increases are so much in such a short space of time. Wages not moving much and tax brackets not moving meaning more people are much worse off.

OP it suits some more narrow minded folks to cling onto this ‘they are loaded’ narrative, it gives them the freedom to say spiteful and bitter things. It’s a very British mentality to not like others doing well and also speaks volumes of the benefits culture that pervades modern UK society. It’s a shame that more respect isn’t weighted to doing well and training given to those who aren’t. We are a 200k+ household and have had to scale back everything from holidays to shopping to school uniform, just to stay (barely) solvent.

@Dreambow much of the problem is that people did not appreciate the extent to which interest rates were held down. And how, comparatively, energy costs were exceptionally low.

It's a shock as people didn't anticipate the potential for a return to the bad old days. We recall interest rates at 15% and proportionately higher energy costs. Historically people didn't heat whole houses, or have much over for treats.

I recall friends clinging on for dear life in the early 90s.

It does appear that you have over extended and sadly, for a while, that means bread and jam.

Ultimately 4000 sq foot houses cost a lot to run in monetary and time terms. They just do. If you must stay in London, and we had to and did, then you will just have to tighten your belts for a few years and suck it up. There won't be much spending money for a while but it will pass.

Meanwhile, get on the waiting list for a childminder - you may be surprised at the turnover, as others will be leaving London, see if there are economies. Get thermostats fitted to radiators and use oil filled plug inside to take of the chill where necessary.

Think of it as getting into training for the school fees!

Move out of London - you can always rent your house out. You will be so much better off. Your husband can commute and you can cut your hours a bit for a better quality of life

I do agree cost of living is so bad right now. I hope you come to some sort of resolution for you, your husband and kids. £38k is a lot to be spending on childcare, has anyone mentioned an au pair, I've not RTFT. Best wishes x

We all seem to have forgotten why the cost of living is now so horrendous.
Mortgage rates went up massively due to Liz Truss's disastrous mini budget and haven't recovered.
A lot of people have had a nasty shock coming off fixed mortgage rates in the last 2 years as a result. Especially since wages have stagnated. I had to extend my mortgage term until I am age 70 to make it affordable.
High energy prices due to the Ukraine war, and increased costs to importers post Brexit have also increased costs of goods and services.
Whoever blamed it on the Labour government has a very short memory.

What on earth does DH do that means he can’t possibly be out of London?

Get a plug in oil filled heater for the children's rooms. For you get some heated blankets

I think my point was- obviously buying a house 11 years ago was cheaper- but we didn't upsize to a 4-5 bed a couple of years ago, we stayed with our first house so we didn't overstretch. In London you pays your money and we chose to be less stretched. Our street is all families in 3 beds, it's totally normal. Your house is too big for you! You need to sell it.

But I do find it really annoying the way people say 'just leave London' like it's not a place people are actually from, with family and friends and support networks. It's not a sort of temporary work dormitory. It's a real place (that also has great schools and fab public transport) and a lot of us actually like it and it's home.

Beefeater I'm guessing.

I’d love this

I sympathise. COL rises have hit everyone. And the interest rate rises have hit worse than for previous generations because housing is now so many multiples of salaries so it has become the norm for people to stretch themselves too far. Growing up my dad was paying a mortgage of about £40K from a sole earner teacher salary of c£20K! If you truly want to not worry about money then moving abroad is probably your best bet. Especially when your kids are pre-school- it's probably now or never!

😂😂 please let that be true

So what are you going to do once the baby starts nursery?

They'd have grace and favour accommodation at the Tower if that were so :).

I feel for you. For anyone who has worked out what they can afford for cost of living to have gone up so much is painful for everyone. You are at that stage of life where you either hang on in there while you deal with nursery fees or reduce pension contributions or try to extend your mortgage and reduce your payments for a while.

Reading more of this I see you mention you took a loan out to pay your deposit. So I’m guessing you never had a good emergency fund or anything either. I think you really have bitten off more house than you can chew. I don’t think you need to move out of London but I think you really need to do diet downsizing.