To be worried about prices going up and up and up

[AMAZINWOMAN]

I am getting scared of the way bills are just rising and rising all the time. Fuel is predicted to rise another 40% this year.

Even though I really am good at budgeting, I can't see a way of compromising any more than what we do now. Our only luxury is the internet, (or essential according to kids and their MSN needs!) which I would be reluctant to give up.

I have looked at loads of money saving tips websites, which is what I already do. I am just worried about the way the economy is going

DanJarMouse, that's about what we have left with a combined income of £80k, just shows how screwed up this country is I have often joked to DH he should put his feet up.

KatieDD how can you have the same left over after bills as someone on benefits if you have £80k coming in...which is around £4,000 a month after tax...

Our outgoings, mortgage, council tax, petrol, tax on DH's company car, childcare, etc are huge.
Once you earn over a certain amount you almost start going backwards because the benefits say tax credits of £500 a year if you earn £50,000 is actually worth £900 because it's tax free if that makes sense, so as soon as you loose things like that you have to earn 50% more just to be in the same position again. It's utterly wrong IMO, we calculated once that with Housing Benefit, council tax benefit, tax credits and food vouchers, my SIL who has never worked in her life, in the short term will be better off. If DH or I get ill and end up having to sell our home to pay nursing home fee's then I will wish he'd had a £20k job and chilled.

I know what you mean about a lot of the family earnings going in childcare...

Are you at least managing to live in a gorgeous house for your efforts and do you manage nice holidays? Otherwise what is it all for if even folk with £80k coming in are struggling

Agree with KatieDD. I'm sure there are many working people who have around £120 per week left for food, fuel etc, so if you have this much on benefits, it clearly doesn't always pay to go out to work does it??

Don't understand the tax credit point. Surely on a joint income of 80K you just get nil tax credits and that is the end of it?

Also JARM has to find her petrol out of that £120.

Noddy holder - well done for your prescience. DH was also prediciting this before Xmas and saying we should sell up - he has also uncannily predicted the oil rises accurately, so very worried becuase he is very pessimistic about the next few years. Like a previous poster said, the gvt has been completely like the grasshopper in the fable, singing all summer while the times were good, spending taxpayers money on rubbish like the olympics, endless consultants and pouring money into micromanaging the health service and education, and we have a very dismal and mediocre bunch in parliament on all sides

exactly jammi. I think life is going to become increasingly stressful for working people.

I'm certainly worried...
I'm on ML - due to go back to work in September. DH and I are on pretty similar incomes, so we have really felt the pinch as we have effectively lost about a 1/3 of our income as I am on SMP. When we go back, we'll have to fork out massively for nursery fees, plus my fuel bill going to work will be approximately £160 per month, compared to £120 last year.
First thing I do when I go back it to start looking for a job much closer to home - we moved away from where I work as DH was field sales based then was promoted to a Head Office job, HO being about 90 miles away from where we lived - hence moving and splitting the distance travelling for both of us, IYSWIM. DH has a company car & fuel card which helps.
Mortgage wise we have a fixed rate until 2011, and plenty of equity as I bought my first house in 2001 before the prices wwnt up massively.
We don't go out much, I might have the odd night out with the girls but that's it! Neither of us really drink - DH has the odd beer now again but only buys when the deals are good.
Holiday wise - we don't have a big holiday, because my Dad lives in Spain so we just go over and visit him and the rest of the family, or we do short 2 night trips up to Scotland (we are big fans!).
But I do think we just need to ride it out and look at the long term view...

But if JARM isn't going to work then she doesn't have the £70 a week petrol bill either.
My point about the tax credit, no of course we don't get them, but up to £50k you do get something, which is a tax free sum, so I worked it out once that if you earnt £30k and had the same kids I have etc, you would be better off than on £51k because basically the government makes up the difference in benefits.
If you can imagine the training, stress etc that my DH puts up in comparision to say a graduate starting on £20k he actually has not a lot more to show for it in reality.
Yes we have a house, again not what you'd expect somebody who has been working for 20 years after Uni to have but that has been down to divorce, bad decissions etc.
We go on holiday once every two years, the house looks like a war zone, everything needs doing to it but we couldn't face renting any longer and being asked to move house every 12 months, due to landlords wanting to move back in, wanting to sell etc etc.
We'll be ok because we can afford the mortgage and as I said we got rid of the debt but on £80k we are not having the life I would have imagined and tbh with my business slowing down we could be down to £55k very quickly and then things are tight.
Which is utter madness

Remind me not to invite NoddyHolder round for Christmas lunch! "We're doomed!" Although I agree with her, she's been right all along.

Tax credits were designed (I presume) to help families on low incomes to be able to get out to work, contribute economically and experience the benefits of working - raised self esteem etc.
What has happened in reality is that there is very little financial incentive to go out to work, or to go for promotions etc because you can be as well off,or almost as well off, (or as badly off, whichever way you want to look at it!) by not doing so. I don't think anyone in their right minds wants to see people struggling to have a roof over their head, or to eat - everyone should have access to basic living needs. But I fail to understand why the govt can't see what to most of us is bleeding obvious. People should be able to see the tangible advantages to working. If you go through training, work maybe 40 / 50 hours a week, put up with all the additional stresses and costs of that (fuel, childcare etc) then of course you should be substantially better off than if you are living on benefits and not working! Surely that much is obvious!

Actually, I think, at times we have hovered at one or other side of the tax credit threshhold. To the point we quite often get some April-July, then when the forms go in, they realise they were wrong and we get nothing for the rest of the year as we were overpaid.

I think Britain will be hit very hard because we have nothing to fall back on. Our service based economy is great while everyone is buying stuff but pretty well knackered when we all run out of money.

There was a very interesting article in Time recently about the US economy (I was amazed to discover that the US is still the world's biggest manufacturer) that said a global slowdown/recession would be good for the US because there would be less imports and more exports and it would actually boost manufacturing and therefore the economy. It helps that US citizens tend to be rather more patriotic about buying American I suspect (though I could be wrong about this).

Of course Britain has no manufacturing base anymore plus we are in a very vulnerable position from an energy point of view. There is speculation that we will experience widespread black outs from around 2012. We need to be growing far more of our own food too. It is very scary and I can't see an end to it.

Growing our own as a nation as well as in our back gardens I mean.

findtheriver - the opposite is true for us. We both work so we get tax credits to help with childcare and when one of our dcs starts school in sept we will be worse off because of the drop in tax credits.
I thought we'd be better off because of only one dc at nursery but apparently not.

not many back garden of any sive left anymore round these parts

Interesting post Callisto. I too am surprised about the US!
I also think alongside (and linked with) the economic issues is the culture that has been fostered in Britain that every generation has a fundamental 'right' to be better off than the previous one. We expect more, and we expect it NOW. There is very little concept any more of planning, waiting, being patient and not expecting to have everything you want all at once.
But then on the other hand, although in material terms, the current generation of say, 18 -25 yr olds seem to have so much in terms of material goods - cars/phones/laptops/wiis etc - for many of them, the concept of owning a home and living independently is unobtainable. It was a difficult enough struggle when DH and I started out, but tbh nowadays it seems impossible. I would despair I think if I were an 18 year old nowadays. All that pressure to go to Uni, get a good career... for what? To end up with 25K of debt and no chance of moving out of your parents home?
I don't know what the answer is (apart from the obvious one from my earlier post - it needs to be far more financially beneficial to go out to work than live on benefits). I think life is really tough these days, and I can't see it getting any easier. Probably the only hope is for people to learn to take a long term view, and realise that maybe we can't have each generation expecting to be better off than the previous one. Maybe we need to have a significant period of tightening our belts before it gets better. Trouble is, no generation wants to be the one that suffers for the sake of long term gain.

I know, and allotments are in short supply too I hear. You can grow all sorts of stuff in pots by the back door though, I've grown really successful runner beans, peas and tomatoes in pots

OrmIrian - carpenters are in short supply in Australia, New Zealand and Canada, check out British Expats for more info: britishexpats.com/

It is depressing how materialistic everyone has become. It is partly our obsession with celeb culture and the fact that the 'haves' are so bloody blatent about their possessions, while the 'have nots' all feel that they should be wealthy by right.

posieflump - that's exactly the kind of thing I'm talking about! It doesnt make sense to me. Surely if the tax credits are because you are paying for childcare; once you stop paying the childcare, you should be at least the same, or better off, not worse off?? If you are going to be worse off, it's yet another piece of evidence that tax credits/benefits do NOT work in the way they were designed to.

Yes, the Super Rich flaunt their posessions and donate next to nothing to charities and the rest of us look at them worshipfully

I don't understand the concept of tax credits - why take tax just to give it back? Why not just tax people less? It would save a fortune in admin too.

Hardly my point Darth. Fifty years ago it was seen as vulgar to be obviously wealthy, nowadays it is seen as a good thing. This is what I meant.