to ask how much money you have after all your bills

[galaxyplease]

left each month, which you consider makes you a middle income family??

Oblomov, forgetting redundancy, uni fees etc, if you don't save, how do you plan to retire?

Are you and dh happy to just receive the state pension at whatever age it is set at? Do you plan to release equity from the house, which I assume will be fully paid up?

I am curious. My SIL does not believe in saving. They have an interest only mortgage. No pension. They live the life of riley. I just don't know what their game plan is.

Petrol - As i said earlier we spend about £450 a month on Petrol. We don't spend so much because we live in a cheap area and need to get to an area with work ...in fact the opposite... we live in London but my OH travels 2+ hours a day (to his own business) outside of London because the rent on the business is cheaper...and i do a lot of short journeys.

Savings - i have no idea what i am saving for ...but it is a nice feeling (i have been on IS in the past) to know that i have money tucked away if i need it

We save for the following reasons:

1. Pay down existing mortgage to buy a bigger house.
2. Potentially retire early - pensions & investments.
3. Children's schooling & further education.
4. Financial cushion to live on in case of redundancy. Having experienced this twice in the last decade - this is a major priority for us. We ensure that we can cover at least a year's living expenses.

In order to do the above, we live modestly relative to income. I like the emotional security of being able to cope with an unexpected major expense e.g replacing a boiler or a few hundred pounds of car repairs.

Holidays & Christmas - I account for in our monthly budget so not exactly savings since I consider them too short term

its interesting what people define as middle income. I count roughly above 18k as lower middle.

As for reasons for saving (we don't have a mortgage). My main reason is I grew up on a shitty council estate (where large amount of income was from benefits). I have nic memories of having to hide so baliffs didn't know we were in and benefit renewals taking ages so living off beans on toast). I always save for a rainy day and then some. But its meant that I could take this job in the states, as large moving costs and no salary until I have a social security number. If we didn't have savings then.....

I think if you can treat yourself when you want to, then your middle class no matter where on the spectrum you are. Also if you don't need to derive a large part of the income from benefits. The UK is so segregated that people really have no idea that whole towns live on so little money.

Oblomov we save for various different things. Our main point in saving is so that we don't have to buy things on credit (although at the moment when interest on savings is so low and yet credit cards offer 0% on purchases this may be a bit silly...)

We save for:

Christmas
Holidays
New Car (instead of buying cars on finance we put a fixed amount away a month, then when there is enough in the pot we change the car).
General emergency fund: for a rainy day
Children's accounts: one each for when they turn 18 (university?), plus one each shorter term.

We are on a fairly low income (low enough not to be worried about the impending tax credit cuts), but the combination of living somewhere where the cost of living is fairly low and spending/budgeting wisely means that we are reasonably comfortably off.

Those of you who save for something specific, do you have seperate accounts for each thing or do you just save into one account?

separate!!

We have a savings account linked to our joint account which is the 'day to day' savings (annual expenses, holiday, Christmas etc) because we can access it when needed.

We then have a seperate couple of savings accounts for the bulk sums of savings we have. We can still access them if needed (we just got all new radiators and carpeted stairs etc) but it isn't 'as' easy as our day-to-day savings. (And yes, I agree that sort of saving is actually just budgetting.)

I think average household income is around £33k. It's been cited on here before and is different from the median wage which is around £25k.

So to be a middle income family presumably you are looking at a household income of around the £33k mark. Plus or minus £10k I suppose.

I think of us as a middle income family even though objectively speaking we are not. Which means that we are just part of the general trend of everyone thinking that they are (a) middle class and (b) middle income

Our money situation is quite variable. I would never be able to plan what we'd have at the end of the month.

If we ever do have left over money, we always just overpay the mortgage straight away. We don't save. We probably should really.

Oh that's a lie actually. I do save something. I have a pension for DD, though not one for myself(!) -I put twenty pounds a month in it for her! She's nearly two.

trixy, I don't see it as savings, more like investments. The type of investment is in turn dictated by the risk profile, the time period over which you are saving and tax efficiencies.

Therefore, if I am saving up for long term, like retirement, I use pensions and equity ISAs. If I am saving for short term, like mortgage deposit, I would use a high interest savings account (maybe some internet savings account).

I would not generally mix savings into my day-to-day accounts because that is not an efficient way of saving. I would however, mix investments for different purposes together eg the ISA could be for school fees, mortgage deposit, car etc

In/Out as follows monthly (1 adult & 1ds):

In =
Salary, WTC, CTC, CB Total = £1,176

Out =
Insurance £40
Electric £90
Telephone £25
Internet/Home phone £27
Water £27
TV licence £11
Council Tax £63
Childcare £85
Petrol for work £175
Other petrol (shopping, ferrying etc) £20
Food £200
Paying off debt (computer, table& chairs, tv, washing machine) £80
Specifically for outings (cinema, zoo etc) £13
Put aside for car tax/insurance/MOT/Services £100
Put aside for Xmas (presents for ds & all family, panto & food) £25
Saving (towards car deposit) £40
Put money aside for holiday £50
Misc other expenses (birthday presents/cards, emergencies, breakages, luxuries like easter eggs etc) £20
Clothes/shoes (for both of us) £35
Cash in hand - for school dinners, top up weekly shopping eg milk/bread, endless requests from school, ad hoc items etc £50

No rent or mortgage as house bought with money from Nan - would rather she was still here though. House falling apart too, bath & loo need replacing, damp in front wall, kitchen doors hanging off, garden shed on last legs and need a carpet upstairs to name a few....

Will be May 2011 at earliest before debt cleared, hope no more emergencies in mean time!

Any extra on car savings not spent in year goes to car deposit fund.
Also electric is often more, but phone is often less so simply swap them about as necessary.

In addition I also get approx £150 from ex for ds (though he didn't pay 6 months this year after losing job)

This is spent specifically on ds (11) as follows:

Money put aside for when Ex doesn't pay £15
pocket money £4
scouts £7
swimming £5
after school clubs £14
clothes/shoes/uniform (as about to start secondary) £26
school trips/scout trips/ school 'holiday'/week away in summer on own £40
Haircut £10
money being put aside for a laptop £25
Other stuff (phone top up etc) £4

Also have to take into account exchange rates and bank charges as Ex sends money in US$ so £150 is only approx each month.

Was paying £12 a week music lessons but had to stop those for time being.

When ds doesn't have school clubs etc that all goes in holiday pot for extra outings in hols instead, so we have a treat to pizza hut or he chooses a dvd or ds game. ALso use tesco vouchers for trips but still need extra for icecream, petrol, gift shop...

The week away in the summer is only £55, but he also needs hiking boots and other equipment for it, plus my petrol costs to get him there and back.
Last year's school trip was about £320.
Anything left in this fund goes to our summer holiday or a short break weekend.

Have no pension or savings other than what I'm putting aside for new car deposit which also acts as my cushion. Am going to have to spend that very soon though and the thought of having no cushion is really scary.

I have seperate savings accounts for each thing, and have standing orders set up each month to pay the money into them.

My grandma had a collection of purses in an old biscuit tin, which she used to put money into each week to pay bills, one purse for each. My collection of bank accounts is basically the same principle, just updated for the 21st century!

we also have current and savings accounts all over the place.

We dont have any money left over at the end of each month as of this one. DH took a forced 25% pay cut in his public sector job and until he finds something else we are in a deficit of £100 per month, we moved to a much bigger house and took on a much bigger mortgage in December but i suppose we should have anticipated all these cuts though if im honest.We are soaking up the deficit with a credit card and i think we will be alright till at least the end of the year and by then i think and hope to god DH has found another job (in the private sector) on a simlar wage to the one he was earning (not a fortune but middle income i would say).

OH, I think the trick is to make sure that you never see the money that you want to save. So work out your budget & set an amount for all the things you need to spend each month (including an allowance for entertainment & for 'miscellaneous' even if they can only be tiny).

Then if your salary is greater than the sum total of the budget headings, set up a direct debit to take the surplus straight out of your current account into a savings account on payday.

Us - varies wildly every month as we run our own business - some months in the summer we end up taking our money & putting it back into the business to pay everyone else . We've been in that situation since about age 24, so we habitually keep our month-to-month spending low & save any surplus just in case there isn't anything coming in next month.

We pay all bills and food for money, petrol and childcare into our joint account.

I have a student loan(only a small one, thank god) and we pay PIL every month for money they lent us to buy a car the week dd was born (work took dh's van back with a weeks' notice ).

After all that, we will have about £600 per month.

Tbh, I am wondering how we will manage on that - after my moile dd, which I pay for myself, I'll have about £200 to call my own.

Those of you who pay all bar about £200 for the whole family into costs and savings - can I have some tips?

I'm determined to save £50, no matter how little I'm left with, just to get into the habit - I don't think dh is so keen.

Oh, and I have to find money for mot and insurance out of my spending money too...

I just did this exercise recently and was frankly stunned at how much money we should have left at the end of each month.

We save €1000, but even at after that we still should have €2500 left. And that's after everything goes out, including Christmas savings. Actually I've been keeping a spending diary lately. What an eye-opener.

If we really managed to hang to our €3500 a month we could save €42000 a year!! Bloody Hell. The mortage would be toast in no time.

blueshoes, we both pay into work pensions, so that comes out before our salary even hits our accounts.thus i don't even miss it or think about that as savings.
but even that will not be enough me thinks. my step dad has just retired last month. dept head for social services, who he'd worked for his whole life. my mum said his pension is nigh on pitiful. they will release equity later, but even then, with both his parents having recently died leaving an inheritence. and they have saved. my mum says even then its hardly anything and there won't be many holidays to france.
so that makes it almost impossible for the likes of dh and i, surely.

oblomov, it is good that you and dh are contributing to pensions. That is definitely a form of savings. Is it final salary or defined contribution?

Under current rules (they can change of course), you can withdraw 25% of your pension pot as a tax-free cash lump sum when you hit retirement age.

Get work you like and continue you it until you die. No one says you have to sit around watching TV for 30 years because you hit 60, Work keeps most people happy.

i worry more about my employer edging me out. I look around my office and I don't see many people over 45!

On a take home of £2.9k we have £1.3k left over which goes on: food & fuel £400, Long term savings £700 and luxuries £200.

We live quite cheaply. I spent far too long living in bedsits when I was growing up and it's made me somewhat paranoid. My one ambition in life, for many years, was to never have to hid from the rent man.

I always skim off 10% of anything that goes into my bank accounts. Even if it's only £1. That way I don't miss the money and I treat it like another tax.

It's something I wish i'd started from the beginning when I started earning, i'd be a lot better off now. I try to advise my younger siblings to do the same, but they just roll their eyes and go to topshop instead.

It comes in very handy when there isn't enough money (such as when I was on maternity or when DP got made redundant) and should a big bill crop up (like when we had to spend £1.5k fixing the car a couple of months ago)

I kind of don't count the money we put into pensions as savings either, it just comes straight off our salaries.

I'm going back to work in August and the plan is to from the start just put a big chunk of it into a savings account so that we never get used to the extra money.