What’s the minimum amount of disposable income for 2 people to have everything they need?

[Awandering]

I have no savings whatsoever so I’m trying to decide on a realistic monthly amount to put away without depriving us of fun or anything that we may need such as clothes and furniture. I’m a single parent with a 7 year old son, although I do co-parent well with his Dad who is usually happy to go halves on anything big.

We live in a council property which is suitably decorated so don’t have to worry about that side of things and my car expenses are all covered under the bills category, including repairs and MOT. The ‘disposable income’ pot would be to cover meals out, hair and beauty, toiletries, weekends out, summer holidays, Christmas and birthday presents, the occasional new game or toy, clothes, school trips/donations and the odd bits like a new bedding set or some nice candles.

I’m thinking £200 would be plenty if I’m frugal, or is that a bit of a reach?

Would you maybe be able to stretch to £250, but put £50 in a pot for presents so your 'fun money' doesn't have to cover Christmas/birthdays (and you might end up with a saving at the end of the year)?

I give myself £200 pocket money and £200 'booze and social' to cover going out, but I could definitely trim it down if needed.

I'd say £200 with a £50 'excess / extra'' would be ok

It really depends. If you have £210 spare and you're proposing to save £10 and spend £200, obviously the balance is off.

But if you have £1000 spare then you can probably afford to spend more if you want to.

Are you entitled to universal credit? If so, make sure you open a Help to Save account as you can save up to £50 pm and you'll get a top up equal to 50% of the maximum balance after 2 years and is designed to encourage people to save for the things you talk about.

I think a separate presents pot is definitely the way to go forward. It has stopped me from overspending on presents and solves the problem that I know too many people with birthdays in April and September.

Have you ever seen the minimum income standard reports from the Joseph Rowntree Foundation?

https://www.jrf.org.uk/living-standards/minimum-income-standards

I like it because it is based on consultations with real people and avoids the 'if you are not living on porrige and tinned tomatoes you are a spendthrift' and 'it's my human right to have 3 holidays a year' extremes.

According to their calculations, someone in your position could have a 'decent standard of living' on £30,465 per year. Depending on how near that was to your income, I'd try to save anything in excess of £31k. Their calculator includes presents and a short holiday so it would include short term savings (Christmas, birthdays etc) but would mean any extra could go towards long term savings (emergencies, illness that prevented working etc).

Thanks, I do actually have £1,000 exactly spare so great guess! I’ll probably up it a bit so that we’re not depriving ourselves of anything when we don’t really need to.

Thank you, this is interesting - I personally think that’s quite high! I’m on around £29k net pay and feel quite comfortable, though I do live in a very low rent area so that’s probably a huge factor.

I’ll add a ‘presents’ category to my bills then, I think I might also stop buying so many toys and treats throughout the year so that birthdays and Christmas become more exciting and we remember to be more grateful for new things.

I’d make monthly saving pots for birthdays, holidays and Christmas then save half that is left for long term savings or home repairs etc and have what’s left for fun money.

I give myself £300 a month but that includes travel to work too which is £13.80 for a return and I got in once/twice a week

I allocate £200pcm for non-essential shopping, going out, clothes, etc. It's a modest amount but feels about right. I agree to put gifts/Christmas as an additional pot.

This has made me realise the £100 a month we have probably isn’t enough and that’s why we always run out!

I think as long as you are saving, anything else is a bonus at this stage