Why do I never have any money?

[Rollonannualeave]

Context. Earn 60k in a full time role.
Own own property. Pay a large mortgage of approx 1.2k per month.
Single parent. Kids ex has tight pockets and contributes nothing.
I shop at aldi and never buy new clothes for me. Just new coats and shoes for kids.
My 3k overdraft is maxed.
We rarely have holidays.
I rarely go out.
Why do I never feel comfortable? The end of every month is extremely tight.

You need to track all your spending to learn where it all goes. Impossible to say without tracking!

Thanks I have done that. Mainly financial services as per the HSBC analysis ap. Mortgage etc.

There are four of us, two adults, two teens, on this combined salary of £60k, run 2 cars.
Our mortgage is £700 pcm and no other debts.
We shop similarlily, holiday to you.
I'd say the mortgage is the difference here, although there are more people/2 cars in our house.

Just checking, we have £10 each mobile contracts, £30 wifi a month, a subscription to Prime and Spotify. The subscriptions and phones can add up. My friend has full fat Sky etc.

Shopping bill for 4 and cat is about £130 per week.

Without knowing the numbers it's hard to figure out what's going on.
I think if you can, sit down and write down a budget.

I did this for myself and set up separate bank accounts for bills, and then also food per each week.

Mine is

• rent
• bills (water, elec, council tax, meds, subscriptions, Internet, transport)
• food and cleaning bits per month (then divided per week - I make it a bit extra to account for needing to buy stuff like pans that's not often and then I adjust my food budget so I eat cheaper to account)

After that I set aside money for savings (different savings accounts)
Then I have some left.
This is really what I have per month after everything else.

My salary is half of yours.

For holidays I go camping or I find ways to stay places that are cheaper (ie self catering in Croatia can be as cheap as £150 per week).
You can volunteer at race weekends and get all the costs covered like food and petrol and camping and you effectively have a free weekend away.

I think its more what you think you want.
I love the outdoors. And sports.
Healthy food and sports are important.

Its easy to spend money on fancy things like meals out or fancy holidays. But the truth is you can have a great life without these.
If you get clothes in sales or second hand that helps.

And just really don't expect to be living luxury life.

I spent two weeks camping last year and I completely lost the wants to buy fancy clothes or anything. It was the most at peace and happy. I think more time outside and start to realise that the best part of life are being with people and doing things together. That doesn't have to cost much. :)

(but also I do think things have got really expensive this year. Uk is expensive now. Bad salary's and high living costs. I'm thinking I may move abroad long term for better quality of life).

But yeah. Sit down and do a budget. Know how much you have left after everything. And you can then figure out how to split that up.

I have about £500 that goes split between clothes and sports and holidays and lunches and treats ect. Everything after bills and food and savings.

I know thst about and know I need to compensate if something costs more one month.

Why aren’t you claiming child maintenance?

You need to write down a list of your out goings.

I would say know where your fixed expenses are.
And what you have left.
And then set some goals. Write them down. Break them down. Track your progress.

My salary was 27k last year. And I managed to save 5k. This was purely because I was very intentional about it
I'd been useless at saving in the past, but setting goals per month and having it separate really helps.

Be patient as well. Things take a while to change. If you're 3k in debt that would take make about a year to clear.

Are you spending too much on food? I think most people can reduce their food bills by eating less meat, fewer ready meals, less alcohol...etc. Apologies if this is not you, though.

It’s because you are raising the kids on your own with no financial support whilst paying a large mortgage. I think that you know that.

Some options to consider would be:

• Go to cms and get maintenance from your ex.
• Change your mortgage to a longer term with smaller repayments. Overpay once your costs go down as the children get older.
• Have a careful look at child benefit. At 50k (after pension contributions) you get full child benefit. At 60k you get none. You may find that overall you’re better off doing eg 4 long days at work and putting a bit extra into pension if it allows you to drop a days childcare and hits that 50k figure.

Good luck!

How much do you bring home? Any pension or student loan deductions?

According to an online salary take home calculator your take home pay on £60k is about £43,849.40 if you aren’t paying into a pension.

You say your mortgage is £1.2k, so that’s £14,800. So you have £29,849.40 a year left or £2,420.78 a month.

How’s your budgeting? Are you paying high childcare or a car loan?

I live alone (no children) and my bills excluding mortgage are around £11,000 a year (and I have expensive council tax and insurance and use oil for heating which is expensive). So about £920 a month.

So if you spend the same as me that would leave you at least £1,500 (£18,000 a year) for

• Extra costs for your child (food, clothes, school trips, pocket money etc)
• Petrol
• Pension (on which you would get tax relief at higher rate)
• Savings for new boilers/washing machines/car replacement/rainy day
• Spending money for you for clothes, hair, makeup and entertainment
• Presents for Christmas and birthdays
• Holidays

Try working your budget out in detail, it should be possible to have a decent life on your income.

All very well making a spreadsheet of outgoings but a PP summed it up. Low wage economy plus higher costs than ever before mean it is actually very hard to survive on what, say 5 years ago, was a really decent salary. We’re really noticing it this year too, OP. As an example, we used to pay £70/month gas and electricity four years ago. It’s now close to £300. We have not had pay rises to cover the difference, nor the extra costs of everything else. We are not frivolous, or big spenders. We do have what we thought were decent enough, middle income jobs. I have another thread at the moment about a one night school trip coming in at over £100. I don’t know if I can pay for it (would never have been a problem previously).

My take home is 3,100. That's because of deductions for a pension and a salary sacrifice car, tax, Nat insurance etc.

Food is about £120 per week including pet food.
Kids dinner money is 80 quid a month! I pay cheap gym membership, 30 quid non negotiable. I also have amazon prime and Disney 😬. They keep luring me back.

I like what a pp said about being outdoors more. Now I just have to convince my kids. They had the biggest moan at me whenever I take them out for a dog walk! This weewked was free music in the park. I took hot chocolate . They still complained like mad.

But will do another spreadsheet for sure.

You need to make a record of every penny spent AND WHAT ON for a month.

Then total up for food, petrol, mortgage, utilities etc so you can see where it's going and, crucially, where you can make savings.

When Covid hit and I thought we'd both lose our jobs, I did a granular analysis of our finances and realised we were spending £500 a month in supermarkets (food shops, plus extra pop ins, plus wine). That's now down to about £250 a month (against a backdrop of much higher prices).
It's amazing how much you fritter when you aren't thinking about it really consciously.

If you mostly spend on card, you already have the information on your spending, no need to wait a month to find out.

You have about £1900 pm after mortgage to pay bills, buy food, clothes, leisure etc. You seem to be at a small advantage that your car costs are covered.

Be honest about how much you spend on food including supermarket shopping, top up shops, takeaways, lunches, coffees, ice-creams etc when on days out. This is almost certainly far more than you think.

If you're permanently overdrawn, you'll be paying interest, can you transfer the debt to a 0% credit card deal and pretend your overdraft doesn't exist?

You need to save some money each pay day for annual and irregular expenses like holidays, insurance, Christmas, white goods replacement etc.

Can you reduce some of your bills? Mobiles, broadband, pay TV etc?

Have a look at:

https://www.moneysavingexpert.com/family/money-help/

I made 5 columns (yours will be different to mine):

• Bills
• Supermarkets
• Leisure
• DIY
• Other

Then went through our bank statements line by line.

Don’t forget to add monthly/quarterly/annual costs.
For example:

Haircuts
Christmas
Birthdays (children, family, friends, children’s friends/classmates)
Easter, Halloween, Mother’s Day, Fathers Day etc etc etc.
Cinema, swimming, ball park.
School fundraising events
Pet costs
Car wash
Window cleaner
Parking charges

There will be loads more incidental little costs which add up and account for ££££ over the course of a year.

Are you making the most of your current account? We get free Disney+ with our Lloyds current account so that might help depending on if you get any benefits with your account.
Do you get child benefit?
I'd start claiming CMS as well

You do need to make a full household statement of affairs. Then look at each category and decide if the amount you spend is worth it.

If your ex doesn't pay you anything then go through CMO, he should be contributing.

Do you spend money on
Nails, eyebrows, eyelashes, hair, fake tans
Takeout coffee
Takeout food for lunch while at work
Takeaway food in the evenings
Bottle of wine in the evenings
Do you have your heating on constantly even when warm outside
All of these things very quickly add up

I'd recommend YNAB - it revolutionised my finances and budgets. I went from never understanding why I had no money, to having savings, contingencies and feeling secure about my finances. I was a single parent too and it absolutely made an incredible difference. The first month's trial is free and then it works out about £7 per month and is worth every penny.

Do you spend money on
Nails, eyebrows, eyelashes, hair, fake tans

Only hair every 2 months and nails

Takeout coffee

Once or twice a month

Takeout food for lunch while at work

Guilty. About 1.x to 2.x a week.

Takeaway food in the evenings

1.x a month.

Bottle of wine in the evenings

Gin in a tin from lidl 2 x a month. 😜

Do you have your heating on constantly even when warm outside.

No all off. But had to us tumble dryer occasionally now the radiators are off and the weather is wet.

All of these things very quickly add up

You do have money which you're already spending on gym, Disney, nails, coffee, lunches, takeaways, alcohol, pets. I'm not saying you shouldn't have a treat but it all adds up.

Maybe look at it another way, work out what you have left after mortgage, essential bills, food, essentials for DC, saving for unexpected expenses, and what's left over is your discretionary spending and you can then focus and prioritise that you chose to spend it on.

Are you claiming single person discount on your council tax? If your kids are under 18 then you should get a 25% reduction.

Other than that, it’s the little things and I am afraid it takes time and effort, e.g if you are paying more than £5 a month on your mobile phone, you need to be shopping around. Car insurance, home insurance, breakdown cover, use comparison sites every single time. Get rid of the streaming services, there’s so much on the catch up apps.

Check your water bill, your gas and electric against what is average for your household size and if it’s higher, ask yourself why.

It is a bit of a slog, but visualise every penny saved on, say, car insurance, going towards savings for a holiday, or think about it in terms of hourly pay. Half an hour on a comparison site that saves you £50 a year on your car insurance is like having a part time job that pays £100 an hour after tax!