Is my budget too frugal/spendy?

[Sillyjelly]

Hello everyone, long time lurker here. I have been trying to get my finances in shape but seem to fall back into my overdraft each month. My BF feels that I'm too tight and this is why I fail, however I feel without peer pressure it would be ok...but I'm so weak!

I'd really appreciate a few opinions on my financial breakdown - and any suggestions!

Bit of background - I have no dependants, owe £3000 on a CC (one large purchase, 0% until end of next year) and £4500 on a graduate loan at 3.7%.

Of my £1300 monthly take home I budget:

£200 Direct Debits (Netflix, Spotify, Phone, Credit Card, travel pass)
£200 household bills
£200 easy access saving (for holidays and xmas)
£50 longterm savings (rainy day)
£200 Graduate loan repayment
£150 Additional CC payment (Standing order)
£300 'pocket money' (includes clothes, groceries, nights/days out etc).

I have a small overdraft of £250 on my pocket money account which I go into monthly, but I feel I'm always playing catch up after paying the previous month's overdraft. I've tried to reset this by paying it off instead of putting in savings, but then I use it again as have nothing for emergencies!

I wish I could just have one super frugal month, but have tried that this month and BF has just booked us onto two trips (I did agree, under pressure, one of them I really want to go on), my contribution is at least £100 per trip so that's me stuffed, again! I planned to pay for one with savings, but with both I'm back to 0 savings.

It's so frustrating!

I'm not sure I understand your question. You are spending more than you earn so you'll never 'catch up'.

I downloaded Toshl on to my phone where you can put in a monthly budget and all your expenses and see where the money is going.

You can also put in a yearly budget for things like holidays and treats.

I don't think it's about having a superfrugal month - it's about sticking with your budget for a few months. So you get straight.

Or increasing your income.

Thanks for your reply.

Really I guess I over spend on the 'pocket money' section (everything else goes through automatically) and so my question was if £300 was too little and I should reduce elsewhere in order to up that allowance? I've no idea what is a 'normal' amount to spend without going too far one way or the other.

£300 doesn't sound like a lot for spendies in a month. But there's people on here who feed a family of 6 on £50 a week and never buy clothes who would probably think it was a fortune for one person on their own.

Sounds like you and your BF have different ideas about money and spending and saving. E.g. getting a pizza to eat in from the Coop and a film you both want to watch rather than £100 on a trip...

That's a good point, I often look at colleagues with families and think I'm doing something seriously wrong when they can make it work and I can't!

We do have slightly different financial intentions at the beginning of the month but I'm so easily led as I like the same things...

Thanks for the Toshl app tip, looks great! I'll show it to him as I think it will appeal to him. I think we just have to both change our attitudes slightly.

Thanks again :)

Your direct debits look like a lot, any chance you can cut down?

A lot of your income is going into paying off debts and saving. Would it be better to pay off any of the debts first, if you already have a 'rainy day' fund and they are costing you money?

Do you pay rent?

That's gonna depend on how much you spend on petrol. I assume you live with him if your "household bills" are only £200 per month?

I spend about £300 on every that isn't bills, but it means that months where I want to be speedy are quite tight. If I was on a tighter budget (e.g. ATM if I overspend on my £300 that doesn't matter as I've got plenty of wiggle room) then I would be breaking that "pocket money" category down further. Eg food, petrol etc. I spend about £80 pcm on food, £120 ish on petrol, with the rest on diy, clothes etc.

first you need to work out how long it will take you to pay off your debt. Is the amount you're paying off a timeline you're happy with?

Second you need to start saying no to things you can't afford til it's paid off. Don't go on trips you don't "want" to go on.

Normal has to depend entirely on what you have available and remember that with easy access credit, what you see others spending may not be the same as what they have available.

Can you find things to do that are cheap so you don't feel like you're missing out?

Also guessing your young-ish and single?

I have a similar income, £1650 and my budget looks like this:

£100 over mortgage payment (don't live in property but tenants rent covers mortgage)
£250 saved into isa
£250 on car
£150 direct debits inc very expensive insurance (live inner city)
£425 rent
£475 'pocket money' but from this I buy food and fuel

Holidays etc come out of my savings account as I'm not saving for anything in particular and my pension is straight from my salary.

Not single, I meant no DCs!

How much is the overdraft costing each month? Why not put the £200 savings into that account for one month and not go overdrawn again?

I wonder if it would help to split out your 'pocket money' £300 into categories - to me groceries are different from clothes are different from entertainment/gifts etc and if I wanted to economise I'd be looking at each one separately.
If it helps (I'm single with one teenage dc who lives with me 1/2 the time) my monthly actual spending is roughly £1200:
Housing costs: 400
Bills: 135
Food/groceries/household stuff: 125
Clothes/haircuts/contact lenses: 65
Transport: 200
Entertainment: 65
Cash spending (a fair bit of this is food): £165
Misc (includes gifts & random stuff): 60

If I needed to cut back I'd record my cash spending but luckily atm I'm fine so don't worry about it.

Are you not paying any rent/mortgage?

I think you are trying to keep up with the Joneses a bit, instead of cutting your cloth. It's easy to do but you can get in real trouble when you are on such a low income.

As for how I do it, I class my savings as another bill to be paid - just as non-negotiable.

These include car savings (for the servicing, MOT etc), household fund (boiler service or white goods etc) as well as "holiday fund", "birthday fund", "hobby fund" etc.

What's left after all that has been paid out is what I can spend for the rest of the month on takeaway coffee and pub meals etc. If there is no money, I don't do it.

I can't believe how low your 'living' costs are. Do you not have rent/mortgage to worry about? My rent alone is £1250 a month! I don't have 'spends' just don't have anything spare after the basics, but we're happy.

My living costs are low as own my house outright with my brother and we share bills - however we'll soon sell and buy separately. I am not young, am 30, just have a childish set up at the moment!

My direct debits include a £100 travel pass, and a £50 direct debit (in addition to my £150 standing order). It's set up like that simply due to how I use various accounts and payment dates. I could cut out Netflix and Spotify but I feel like they're good value for how much I enjoy them. I could cut them out in future. I also pay for RSPB membership but that's important for cheap days out (and saving the birds :P).

Overdraft is usually around £8 p/m, it's just the frustration of overspending that bothers me as I need to have much better habits when I have a mortgage etc.

I have spend all my rainy day money on driving lessons so would be happier rebuilding some - perhaps I should prioritise debt but I'm wary of emergencies. No petrol costs for obvious reasons!

I think I do need to break down my £300 spends further and see what's going wrong there - so thank you to the people who suggested that! I definitely should separate groceries from clothes/days out. It seems so obvious when it's pointed out...

My friends all earn a lot more than me so they don't think much about a couple of drinks every now and then, I worry about invitations drying up - but if I don't have the money I need to be tougher and just say no.

overdraft charge is £8 p/m I meant*

Oh and I've tried just paying off overdraft one month instead of savings, but then something has come up and I've dipped into it again!

...the more I answer the more it seems like I have a willpower problem and not a money problem...

One thing I'd say is that just the act of writing down / recording everything you spend is a good way of saving money, it makes it very immediately obvious where things are going.

Your mates aren't going to dislike you if you turn down a few invites or just go with tap water once in s a while.

In fact, I bet some of them would be quite relieved that one of your group has had the balls to say that you are cutting back and might join you!

...the more I answer the more it seems like I have a willpower problem and not a money problem...
Yes. You need to find a way of dealing with this that suits you - whether that is complete cold turkey, or analysing every penny, or whatever. It's the only way you will stick to your new plan.

Good on you for tackling it before it becomes a millstone too.

When does the 0% on your credit card run out? Does the £200 cover the time you have to pay it.
Spotify account- ds only pays £5 & mobile £8 including data. Unfortunately you have to look at the littlest things when your up against the finances.
No new clothes for a few months or takeaway
And does your graduate loan need to paI'd back at a high rate. Iso this and automatic payment.

Use free Spotify and an ad blocker. That solves that one.

Say no to big outings, it is spring so plenty of free stuff to do.

I'm going to suggest two very drastic pieces of advice but it will help you out of debt faster:

1. cut up your credit card - just concentrate on reducing the bill

2. cancel your overdraft - each month reduce the overdraft limit by £50 because you are seeing it as an extension of your spending budget every month. Once the money is gone that's it, no more spends until next month.

Also concentrate on making additional money, either by increasing your monthly salary or selling stuff etc.

Go through all of your monthly outgoings for mobile, WiFi, insurance etc and see if you can switch to cheaper deals.

Use top cash back to build up a cash back pot of money on all of your online purchases, it soon builds up.

Can you have nights in instead of nights out to save cash? Watch the bbc1 program Shop well for less on iPlayer for money saving inspiration.

The graduate loan seems high. Is that with the Student Loans co?