How much money should I have left every month after paying the mortgage and bills?

[SadPander]

Just that really. We're currently trying to sell our house so that we can move to a nicer area before starting a family and I'm trying to figure out how much extra mortgage we can afford to take on. I'm struggling as we will be moving to have children, but don't have any at the moment. Despite having a resonable household income it looks like childcare is going to decimate that and I'm not sure how we will afford to stay in our current house, let alone upgrade!

So after you pay your mortgage, insurance, household bills, food shop, child care (basically all of the essentials) how much do you have left over every month for - enjoying yourself, long term savings, saving for holidays, household/car repairs? And what would you say was a sensible ammount?

Also do you have a contingency fund, either in the form of excess money every month, or a lump sum in a savings account to cover the possibility of interest rates rising or your roof blowing off?

Thank you for sharing!

£50 a week is what i try to save, sometimes its more, sometimes its less. did have over £1000 in savings until the boiler broke a little while ago

Too many variables.

You can have people that have nothing left, because that's how their current situation is.

You can have people who are in debt every month and relying on the overdraft and cc's.

You have people who have crap wages, but budget everything and have money left over.

You have people who have loads left every month.

Then what is essential for you isn't essential for others.

We have money left every month. How much is irrelevant because its down to our income and expenses. We live within our means so that we don't have overdrafts, credit cards, store credit etc.. But someone else I know, earns more, but their essentials differ so use credit cards etc to live month to month.

Id find it really hard to give you a figure, every month is different. Have you worked out a budget for starters? List all incoming and outgoing to the household and take it from there. Look for ways to decrease outgoing/increase incoming...I use an Excel spreadsheet which 'predicts' how much I could have saved by any given month for next 3 years. I used it to determine when I could afford to buy first home. It really helped whenever I had to add an outgoing on to it as it made me challenge spend that was putting my goal further back.

MSE has a good budget planner.

Thanks for all your replies so far. I know its a difficult question to answer sorry! I have worked out a budget(good idea to put it into Excel or MSE planner though thank you) - adding the monthly payments for the mortgage I would like to take out leaves me exactly zero after mortgage and all essentials (food, council tax water and all those things that I have no choice but to pay), there isn't really much room to cut back as we are pretty thrift already as saving for this move. The budget is based on us having children by the way so taking childcare costs into account, at the moment we don't have any children and would have about £500 a month left.

Obviously it doesn't seem like a great idea to have zero left in the bank every month in case my boiler breaks, car breaks down or interest rates shoot up (after the fixed mortgage period ends) etc, so I'm just trying to get my head around how much is a sensible contingency fund to be keeping by per month for this sort of thing. Holidays and other luxuries I can do without if my budget goes wrong, but I'm just thinking, how far would a sensible person stretch themselves on their mortgage?

I try to keep approx 3 months salary as contingency. Anything over that goes to savings and towards stuff for new house. Ive also saved DS child benefit/gift money since he was born but keep that separate to contingency and savings.

I can only warn you of my story and then leave you to take your chances.

We moved house with the intention of having children. We had the budget all worked out and could afford the Childcare.

Then the season ticket prices on the train went up (both commute a long way with huge season ticket prices) and we had twins. We are now running at a monthly deficit, reliant on family for considerable Childcare and occasional financial subs to help manage the cash flow. Savings might just about last until the free hours kick in at 3 years old and the Childcare bills reduce. I hope.

We're lucky we have generous family who are willing and able to help with Childcare, financial loans and financial gifts. Without them we'd be in serious trouble.

I don't want to scare you, and believe that most people would never have children if they waited til they can afford it. But we did wait til we could afford it, just hadn't considered twins!

Don't leave yourselves too vulnerable :)

You need SOME money over after all essential bills, food, clothes, haircuts, dental trips etc are paid for. If you get to exactly 0 what happens when something unexpected happens? House prices aren't likely to shoot up in the forseeable future so could you start tour family where you live now & then move once you're back at work & have a more realistic idea of budget?

I definitely second the need for contingency. I thought i was really smart with my budget planner but having excel sheets to monitor spending isn't the same as actually saving money - just because i can track that money's coming out doesn't stop the money coming out iyswim!!

we moved to a house i was sure we could afford but various uncontrollables mean we are now living very much hand to mouth. Just this week both mine and dh's cars needed work which adds up to £2k!! We're scrapping any plans for a summer hol now and i reckon we may clear credit cards and over drafts by autumn. But that's on the basis that no other random costs emerge from the woodwork before then (probably literally in the case of our damp and slightly rotting house!).

i suppose my point is that costs will always arise over and above the essentials you listed, so you really do have to plan for them if you want to feel secure and away from debt. I often fantasise about downgrading our house (which is not massive but prob cost more than it needed to because it looks pretty, old and quaint) to something more practical and cheaper so that I didn't feel so stressed about going over our budget every sodding month!

I posted a similar thread as we were trying to budget for a bigger mortgage and I have no idea as to what is classed as an acceptable average amount of disposable income to have left after everything essential is paid for! It seems to vary so much but I would personally need at least £400 left over in order to have some fun( isn't that what life's about?! ) and some savings in case of car /house maintenance and emergencies which may occur. That's just my opinion though, as I say it differs widely and circumstances can change at anytime for anyone.

One thing I definitely think though is that Itis a good idea to not just blindly buy the biggest/nicest/most expensive house that you can as I have so many friends and family who have done this and are permanently skint despite having well paid jobs. If having a bigger mortgage makes you "skint" remember the mortgage lasts a very long time!

If you go on the boards at The Mötley Fool, either Dealing with Debt or Living Below Your Means you will see in great detail how to cut your costs to the absolute bare minimum, there might be some places to cut back that you haven't thought of. If you post a budget there (I think they call it s statement of accounts) then some very experienced budgeted will come along and tear it to shreds give you detailed advice. I think that MSE will have the same boards but I haven't been on there as much.