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.

Thank you
All very helpful suggestions

You can cut food and school lunches immediately.
I'm a single parent too, take home Inc maintenance and tax credits about £3000.
Food bill £60 a week max plus £25 sack of dog food per month (2 dogs).
School lunches - £10 each per month - they have one a week, pack lunches the rest.
That would give you £300+ extra a month.

She might be. He might be one of the many men who get away with it.

Could you make your car costs any cheaper ?

£1200 a month is quite a high mortgage on 60k, it is technically affordable but at a over a third of your take home it won’t leave much room for holidays etc.

Not much that you can do about it, unfortunately!

I really like the book All Your Worth and it talks about a framework to use to make you feel not stretched. I do find that sticking to it really has that effect.

So you look at your net income but add back on your pension contributions.

Ideally you’d allocate no more 50% of this to essential needs: your mortgage or rent, council tax, home & life insurance, essential childcare, car tax/insurance, internet, child maintenance etc.

Many people who feel overstretched, it’s because their needs are higher than 50%. This can be unavoidable at certain times (eg. When you have high childcare costs because your kids are under 3) but if it’s long term, it usually leads to scraping by and being unable to save. If your mortgage is very high, it may mean that this part is out of balance and that might be why you struggle.

She then suggests that you spend up to 30% of what’s left on wants and at least 20% is saved or paid off debt (including your pension contributions). For people who don’t have high bills but still can’t save, it’s because they spend too much on wants (shopping, holidays etc).

I do find the concept useful as I think diagnosing whether you spend too much on needs or wants is really helpful. The latter is much easier to fix quickly of course!

To figure out what’s going wrong, the best thing to do is to track what you spend for a couple of months and then see how it compares to the ideal 50/30/20 formula.

As a couple, we take home more than you I think (our take home is about £4,200 a month) but our mortgage is way, way less (just over £500). And we only drive old, cheap cars so don’t get commercial car loans (I did borrow a bit from my mum interest free last year to get a new car after we spent most of our savings on a lemon 🙄, but this is the first time I’ve borrowed for a car). Of course we do live in a low housing cost area which makes a HUGE difference. We still live in a 3 bed end terrace with garden for that price which I appreciate isn’t possible everywhere!

The two factors of choosing a cheaper, smaller house than we’d have been approved for, and choosing to avoid expensive cars, is definitely the main factor in making our budget feel easy to stick to. Our needs are under the recommended 50% which means we always have money to spend on fun and save. I do enjoy frugality and thrift but the truth is that you can only save a certain amount by being frugal in your every day living, versus the huge amount you can save by making certain choices in housing and transport.

The other “one off” which would likely make a huge difference would be getting child maintenance paid, that could really help balance the books for you.

You sound bloody amazing! Very inspirational.

It’s because the cost of living has rocketed whilst salaries are not keeping up. For the last 10 years I’ve had 1 or 2% pay rise and this year nil. Earning £60k 10 years ago was a good salary. Now it’s no where the equivalent. As another poster said 10 years ago I was paying £70 month for all energy now I’m paying £300 month. That was my holiday money or emergency cash. Remember this at the next general election.

Also meant to say, I totally agree with a previous poster about looking at ways to have fun and enjoy life that don’t cost, like getting outside more.

We spend family time gardening or going for walks and to different parks rather than expensive outings. My kids are young (7 and 4) so I appreciate its trickier to persuade older kids!

When I want to see my friends (which I do a lot as socialising is important to me) we hang out at the pub having 1-2 drinks (sometimes soft drinks), visit each other’s houses or meet in the park with our kids and catch up while the kids play. Just as much fun without the costs of big nights out.

I decided clothes and beauty aren’t priorities for me so clothes are either second hand or from supermarkets, and we run quite minimal wardrobes and wear stuff til it wears out. I cut everyone’s hair in the family, including my own waist-length hair, and don’t get nails or tanning or anything done.

For food - we don’t buy any packaged kids snacks which really saves a lot (except yoghurts but these are value brand). My kids snack on fruit, toast or yogurt. I try hard not to waste food but it’s definitely an area I struggle with!

Thanks for all these suggestions. Keep them comming.. On a pps suggestion i have gone through my direct debits to see what I can cut. I've also gone to mobile phone provider. And I'm out of contract so will switch to sim only.

And thanks great book suggestion @Bluegreen143

I earn roughly the same as you, one hollow legged teen ds, mortgage, tight-fisted ex.

We spend £55 a week on food. so £120 seems a lot.

I don't pay gym, I parkrun & cycle.

I don't have tv subscriptions, we watch a lot of catchup. No pets.

I don't do coffee out or takeaway at all, do my own nails. I wash my own car or pay DS to do it.

That saves probably close to £220 a month.

@MintJulia that is a low food cost. My kids are fussy eaters. Also I lift weights and enjoy the social side.

This is the way to be honest, do this for a few months and you'll no doubt see some patterns and be shocked by how some random stuff adds up. For me it is doing top up shops, I was spending 20 quid here and there as well as a big shop but I saw it as just a small amount each time and was shocked. Now I meal plan and do a big shop- top ups I write a list for so don't end up with random stuff. Also with subscriptions made a tally of how often I actually watched stuff on them and got rid of the one I watched least.

@Rollonannualeave it's really not a low food spend - mine is similar. Doubling it would be a massive effort and upgrading everything.
You need to sort the fussy eating if it's costing you more than double.
Mine still eat stuff they like of course.
Are you buying lots of ready made food?

A friend was recently rationalising her high food spend to me. Some examples were kid doesn't like the colour of aldi's fake lurpak (seriously!), kid likes pringles so has them weekly (so do mine, but not weekly, and Aldi fake ones when we buy them) etc etc. Nothing wrong with saying no.

I don't remember what ages your kids are? Depending on ages you need to get them on board - this is life skills for them too.
Are you paying for outings every weekend? Those are treats here - 1 or 2 per week off school. Weekends are walks, beach, home stuff. Occasional cinema.

Do you have any work benefits that are taxed that you don't need, eg healthcare?

Sorry to zoom in on the hair and nails side... how much does that add up to? I get hair cut quarterly, coloured every other time, at an expensive place. It costs me about £600 a year. When ds was at home and i earned less, I never used to go to the hairdresser at all (even tried the Mumsnet haircut once). I'm luckily old enough that nails weren't really a thing when I was younger - you don't have to spend on that. Essentially you are probably spending the cost of a (very cheap) family holiday on hair and nails. It's not that you should have to give those things up if that's what you want to do with your money, but make sure it's a deliberate choice where you spend.

Big costs for me used to be transport and presents. Presents for other people were my shopping hit that I didn't feel guilty about, and I didn't budget for. They cam add up to a ridiculous amount if you move in present-giving circles.

Another vote for ynab here, it's a game-changer

No, the difference is you have two tax allowances. OP has only one, so only gets one tax free band and will be on 40% tax for part of her income. It makes a big difference.

Op, get thee to the forums on Moneysavingexpert. They are so helpful on budgeting and getting out of debt. Good luck.

Im impressed with the £60 quid a week shopping brigade. What do you buy for that? Is it meat based we we don't eat meat!

One thing I have done in the last few months which I feel has really helped me get on top of budgetting, is put everything into separate 'pockets'.

I have one 'bills' account that all the mortgage, insurance, direct debits, council tax comes out of. This is the same amount every month and are all things that can't be cut - as soon as I get paid I transfer the exact amount into that account and don't touch it.

I withdraw £500 cash for food shopping for the month. Takeaways and coffees etc have to come out of this.

Everything else is split into accounts for - kids expenses, car costs, big spending (eg holidays, birthdays) and day to day spending. I've looked at my budget and know exactly what I need/can afford for each.

Then you have to be pretty ruthless. If you're low on food money by the end of the month, don't get a takeaway. If there's nothing left in the spending account, don't spend it etc.

Meat free can be a much cheaper, do you buy a lot of substituted? Using lentils/pulses/beans instead can save money and are a good source of various nutrients.

Do you have other debts other than the mortgage and overdraft ? Overdrafts are expensive (40% interest usually) so you must be paying interest on that (£100 per month on a £3k overdraft). Personally I would be trying to get rid of that and cutting back on buying lunches out and takeaways.

@Rollonannualeave yes we eat, but not lots and not processed and feed 2 active sporty teens.
Lots of bulk cooking - Bolognese (mince but bulked up with lentils), curry (using leftover roast, but filled with veg), fajitas for a treat, sausage casserole (just as good without the sausages).
Rice stir fry, noodle stir fry (veggie).
Lunches - sandwiches, soup, home cooked baguettes, crisps, fruit (not berries etc, apples, bananas, satsumas), leftovers, carrots, cucumber, cherry tomatoes.
We eat well!!!

Look at it the other way - what are you buying? Why does it cost you so much?
Easier for us to see where you can cut down then.