36 year old couple… How bad are our finances?

[UpQuick]

DH and I both work. We have £25K saved in a Lifetime ISA as a starting point for a house deposit. We have a combined income of 4,000 per month, after tax. That’s to cover all of life’s expenses. We do have £2,000 on a 0% credit card.

we have recently moved from a rented house into accommodation provided by a family member. They are giving us a discount on this, so it’s helping us to save. We also have two DC age 12 and 9. The thing is, we would really like another, but I’m worried that would be totally irresponsible.

very grateful for opinions…

I should have also mentioned, we have no debt other than the £2,000 credit card. No car loans or anything like that.

I would probably wait until you have the house secured if that's what your aim is. If you are happy to rent off family long term and they won't kick you out, go for it. Will you be able to save for a bigger house for more children?

It depends on how much your outgoings are each month. If you have a budget, play around with it and see if you can afford your outgoings whilst on maternity leave and how much you have left etc and whether this is manageable.

Kindly,
You have tiny savings, you don’t own your own home/not yet on the ladder, have some debt albeit small. All of this is actually fairly normal. But, add another child?? It’s not totally irresponsible but it’s perhaps going to add additional pressure when you have little wriggle room?

All sounds fine. You have secure accommodation (assuming family member will let you stay there indefinitely?) and more savings than most people. Not sure why another child would be a problem

I think you are doing well but I'm sure you'd like to get on the property ladder soon? Is property expensive where you are living? £2k isn't much debt between you. Regarding another child , it's doable imo if you cut costs . I imagine you don't have much baby stuff given the age gap? Could you get some of it second hand etc?

If you want to do it then go for it.
But I'm not going to pretend to act like I would have a third child in your situation.
Your main focus should be housing, your eldest is already 12. Renting is secure but if you either get a lifetime tenancy, or a private tenancy where you know you can be there for a long time it would be ideal. Or having your own home, whether its shared ownership, right to buy etc.
Second, your youngest is 9. Do you really want to go through the baby stages again when your eldest is going through their teenage years?
Third, consider if you cab still do the school runs and pay for extra circulars with another child.
Of course, if your standards for your children is to just keep them clothed, housed and fed then do what you want I guess.
It's a subjective question really. Everyone has different standards for their kids, some higher than others

I wouldn't in your shoes. It's a very big age gap for one. Secondly and most importantly you don't own your own home. Renting is fine if you are adding to investments or building savings but if you had a falling out with your relative or they had to sell then that would leave you vulnerable. I'd look to buy your own home and focus on building up a pension pot and savings for the two children you already have.

Don't do it. Create a stable home for the kids you already have. If your relatives suddenly decide to sell up for any reason, you'd be screwed and that £25k will be gone in the blink of an eye.

Sort a house first . Will your children want to go to university? You will be expected to support them, so you need to consider that .

They don’t own property, already have two children and owe £2 k. Some have another child in these circumstances. You can’t afford it.

Don’t not some

It's not a bad situation, many struggle to buy. However if a family member is renting to you for the purpose of saving for a house deposit and is expecting you to save then move they may he somewhat pissed off if you announce you're pregnant. Baby expenses, childcare and maternity leave will have a significant impact on your ability to save.

Well they could have a third child if they spend their savings and go on universal credit when the baby is born to help with rent and childcare costs.
But then, what would be the point of saving up in the first place?

I'd wait until you've secured a property if that is your aim. If you had another DC now you'd be home so lower income and/or high childcare cost. I'd be really focusing hard on saving all I could for the deposit. Once your house is secured I'd wait a full year before trying for another baby.

I thought there was still the 2 child cap ATM.

UC is the answer ? 😂

Buy a house op and be happy with your two children. Pay off your debt. Save 3-6 months expenses

Don't bank on reduced rent for long term as HMRC are going after Landlords that are not charging market rates for rent on their properties.

So if I were you, I'd buy yourself a home as soon as possible.

I wouldn’t have a third child in your circumstances. What’s your pension provision, death in service, health insurance life insurances like ? All the tedious stuff for when when you are getting on in years and or the horrible details of dealing with one of you dying or being seriously ill.

Give the two children you have a better chance in life. You can give them more time and fund school trips or hobbies more easily.

Why not focus on your two children. One is about to become a teenager, a time when they’re going to really need you emotionally. You won’t be able to give them much of your time if you’re dealing with a newborn, will you. You can’t pour from an empty cup.

I am one of 4 and I definitely didn’t get enough attention and emotional support from my parents because they were spread so thin. And that’s with a SAHP for most of my childhood. By contrast, DP is an only child and he’s the most emotionally healthy person I know. He has that quiet self-assuredness that can comes from lots of support, attention and stability as a child.

The amount you can borrow to buy a house takes into account the number of dependents you have. Also your DC are still at the cheap stage. They are about to get much more expensive and also harder to parent.

If I were your relative I'd be very annoyed that I was giving you a discount on rent so you could save for your own home if you turned around and had another baby. That's really selfish. Expect to damage that relationship if you do this.

Go and see a mortgage broker before making any decisions. They can help you figure out what you can afford to buy, the difference that another child would make to that and how much more you need to save.

Realistically start trying now, a few months/6 months maybe a year to conceive. 9 months pregnancy. Your baby will be a toddler or younger when your eldest is doing their GCSEs.

It's a stressful time anyway, but throw in a younger child who needs all your attention, seems unfair.

Do you really want to go back to newborns, toddlers, juggling childcare and work etc etc when you're nearly at the stage of 2 secondary age DC, who will be a bit more independent, but at the same time becoming teenagers so puberty, exams etc? Seems nuts to me.

Otherwise, your income and house deposit looks like a reasonable position providing it will buy you a suitably sized home where you live - eg if you could get a 3 bed for £150-200k on a 80/90% LTV mortgage. However, if prices are much higher where you are, you might need a lot bigger deposit, which would mean at least a year or two of frugal living and hard saving, which also doesn't tie in with another baby.

Do you expect your incomes to increase at all?

I'm not sure why you've decided to keep the debt, you'll need to pay it off at the end of the interest fee term so it's good to have the funds saved up ready. Stick the money in premium bonds if nothing else so you get a chance of earning something.

Having a baby is fine if your finances add up, without knowing your outgoings nobody can help with that. It's worth considering how you'd get in financially if you had twins, or if your new child had disabilities requiring more caring time. If you're happy that would be covered then go for it.

In your circumstances I don't think it would be right. Everything major that you do as a parent should consider what's best for the children you already have and I think this would be unfair on them.