Why do i never have any money...???

[Remmy123]

Hi all,

This is my first post but I have been a long time lurker, husband and I have been wracking our brains to work out exactly why we struggle so much financially.

This is not something we can talk to openly to our friends as finances are obviously personal, and I have gained alot of advice from this site so far...

Background:

Husband income after tax PCM: 3,400.00-3,600.00
My income after tax PCM: 900-1000

Outgoings:

Mortgage, council tax and utilities: 1,800 (on a very high interest rate due to end in September so will lower dramatically we hope)
Car loan: 130.00
Credit card: 100.00
Next directory: 50.00
Food: approx 600.00
Nursery fees: 300.00

We are overdrawn at the end of the month by £2,800 – is this where we are going wrong????

We go out once a month if that, hardly ever buy clothes, we get the end of the month and we literally have no money and have to borrow at least 200 from my mum and pay back we cannot afford a holiday this year, we really are very tight and get bargains on everything, i never buy new make-up, etc.. its depressing

We are so frustrated as we both work very very hard and when we work it out it seems we should be comfortable not skint

We must have totally over-stretched ourselves with our mortgage but ironically we have had the same mortgage since 2007 and managed when I was on mat leave and husband income was at l east 400 less PCM.

I could bang my head against the wall!

Thanks to those who can help or see where we are going wrong...

Remmy123

Remmy it really does feel really good not spending like that and being conscious of it.

And it feels better and better too as you progress. And then when you NEED to buy something you can buy the nice thing you prefer rather than the cheaper 'that will do for now' as you have the money to do so. Having said that I still get the urge to buy stuff all the time - this lifelong programming is deeply embedded, but I am aware now, so I say no, don't need it, choose not too etc.

OH PLEASE come back and tell us how you get on at LIDL. I freaking love LIDL & ALDI. There are none near me but I travel to one once a month for my 'big' shop - pretty much the only supermarket shop I do a month now. You will be amazed how much you get for your money.

If you do a search on MN there are lots of "What shall I buy/avoid at LIDL" threads for detailed advice. Double packs of ground coffee = good. Tinned sweetcorn = avoid.

OP one thing I would add to all your great advice - you need to make sure that your DH is onboard with this approach and is making the cheap decisions too, so whilst his lunch is going on the company credit card, it still costs you money somewhere.

I went on a great cut down about 18mths ago - got rid of the cleaner, started buying from Aldi etc etc. only to find DH decided that he could buy himself a new car.

Fast forward to now where we are short of cash, looking through spending and I have started to do my bit - so working my way through the freezer and food cupboards, stopping booking holidays (although to be fair I'm shocked at how much I have booked for this year) but gawd help me this time I will go through DH if he doesn't keep his end of the bargain - no more electrical impulse items, huge overspend on presents for his family, random tat from the supermarket.

I honestly think online food shopping has saved us a fortune, no random extra shopping!

Yes will come back and tell you how my lidl shop went, why am I so excited about going to lidl?!! Won't be going until at least wed or thur next week.

Its so hard to remember all of your names but whoever was going to help me with categories that would be a help - thank you...

Alibaba - your as bad as me!!!!

Rookiemater - my husband is 100 per cent on board, he doesn't spend a penny, he even drove sat night to a friends party to save money in cabs and drinks and that is the first time out since before xmas. All of his friends are off on ski ing trip this weekend and he would not even dream of going until we have money saved up. He is very good. Fortunately his car is a company one.

Thanks everyone your all fab!!

I've been (relatively) not impulse spending for a year now and I still had to bend down and stroke the heavy duty roasting dishes heavily marked down in Sainsburys Local today (buying grated cheese). £6! A bargain. I held them. Then I had "the conversation" with myself, put them down and moved on.

Do beware the IKEA effect in LIDL - "only 59p - into basket", "what only £1.29 its so cheap" - in basket etc.

remmy we were where you are 2-3 years ago. Very similar income and we felt like we should be able to afford xyz but never had any money.

We really got a grip of things, we have a much more detailed budget and we put money aside each month for Christmas and car expenses and house repairs. What we have left in the bank account each month we really can spend because there is other money elsewhere to cover additional things that crop up.

It has been great, we are much happier, and when we had an increase in income we really felt it and we've been able to allocate it to savings and holidays and it doesn't get swept up in the general pot.

So I do have a fritter occasionally, because I know I can accommodate it within the budget.

Yes, I have "the talk" with myself when I'm in a shop browsing off list and it feels good to walk away, like a victory over myself :)

The only resolution I have made this year is to properly use things up before buying new. For example, I switched down from expensive skincare to high street a few months ago and had a few cleansers on rotation to decide which was the best. I now know which is my favourite but the others are fine for my skin so I'm using them all up before I buy the favourite again. Previously I'd have probably just said "ah I like that one best so I'll just bin the others or leave them in the drawer unused and get the one I like now". So unbelievably wasteful, and unnecessary given they're all perfectly adequate! Part of this is inspired by some of the minimalist ideas that BeCool refers to. I don't want the clutter of half used tubes of skincare in my drawers and I don't need the expense of buying new when there are half used tubes of perfectly adequate stuff lying around. If it brings me out in spots, I'll bin it but otherwise I'll use it all. I've only spent £2.99 on beauty type stuff this month instead of my usual £20 or so and that was today so I lasted most of the month before I needed anything!

Don't forget to join us on the YNAB support thread :)

Thank you - its very interesting hearing your stories, will look out for the YNAB support thread.

It is genuinely hard for me to find ways to cut costs apart from meal planning as I am such low maintenance. I buy a simple facial wash which lasts a few months, and a big bottle of palmers cocoa butter mosteriser and that's it. I get good quality makeup which lasts me months, die my own hair etc...

I think the bottom line is budgeting which we don't do.. I am looking forward to seeing the benefits in the next few months!

hope not too late - to add some ideas:

lots of wastage here. For instance nearly £400 a year on contents insurance, I pay half that for buildings AND contents! I'm in a cheap insurance area but you really, really need to shop around on the comparison sites. You say you have a mortgage so you must need buildings insurance.

£50 a month at Next??????? Stop all buying of adult clothes. Kids clothes come from much cheaper places than Next!

Sky is the obvious one to go if money is tight.

back in a minute when I've looked at the rest.. :-)

other thoughts: £60 a month on mobiles? Wowser. Do you really NEED mobile internet? Go PAYG and simple phones, never chat on mobiles, that's what free landline minutes or skype are for.

TV licence is £12 a month, unavoidable and trivial.

car loan; you are probably stuck with this but next time, buy an older car out right. You can get decent vehicles for £2k or less, you are paying that a year. Can't see car insurance on this, again shop around.

final waster you mention is 'home fragrance'. Don't! Open windows!!

good luck.

Another YNAB and moneysavingexpert fan here!

Spent the last few months cancelling mobiles, switching utilities (saved £75 a month, although bill is still high) and putting credit card debt onto a 0% card (saves £150 a month interest).

I still struggle to reconcile YNAB exactly, but it lets you put "adjustment" transactions in, so the balances match, but you don't mess up your categories. I have put Christmas and DD's birthday in this year - previously I had no clue what Christmas cost, I'd just get what I wanted from whatever my annual bonus was (a few K, not enormous, but better to have something left from it).

I'd say use the debit card as much as you can, rather than cash, as that means it shows up on the online banking and is easier to put in the budget. DP and I took out £280 cash between us this month!!! This means £280 that we can't categorise.

Haven't yet had that time when I find some spare money at the end of the month, but at least I'll never have that fear at the end of the month where I daren't even look at the balance. Also if I borrow from the savings at the end of the month I make sure to put it back, whereas before I'd forget, and feel pleased with myself for not going over the month after. I also got into a bad state with work expenses I was putting them on the credit card, but the claimed money would go into my bank account and I forgot to transfer it over. So when I finally started to take control of the money I realised we were overspending about £500 a month, while the credit card balance grew and grew...

That was all a bit random but wanted to say you are not alone :)

YYY to switching utilities and shopping around for insurance. I switched last year using uswitch. It promised me savings of £1000 which I couldn't believe - yet 11.5 months in, and even including that ridiculously long cold winter we had last year, I am on target to save that grand! I plugged my numbers on the other day and they reckon I could save another £300 by switching again so I might just do that. We also switch house and car insurance every year as it is always cheaper with somebody else - they prefer new business over old as they have such a high inertia rate that it pays them to attract new customers as most just stay even with x% increases to premiums every year. Be an insurance whore :)

I can't add anything others haven't said. It would be great if you came back in 6-12 months and could talk about where and how you found savings.

I think there's a lot of room for reduction in your food bill. Does that include booze or fags?

I make a wonderful chemical free home fragrance in seconds - choose essential oils to suit you.

You need a small fine mist spray bottle I use a 150ml bottle from Muji:
150mls water
4 drops of washing up liquid
10 drop max of essential oils.
Shake.
Spray.

The washing up liquid disperses the essential oils through the water. One bottle of this lasts for ages and I used essential oils I already had for oil burner.

Currently my "home" blend is ylang ylang, geranium and patchouli.

Suitable for use anywhere in home, no chemicals (bar a tiny amount of washing up liquid).

I think you need to include Christmas etc on your monthly budget. If for instance you sound 1k on birthdays, Christmas, anniversaries etc. Where does that money come from.

Great to know your DH is on board Remmy.

Don't forget to add "unexpected expenses" to your list. Just went through a budgeting exercise on Saturday with DH, as we were doing it, literally, the heating stopped working , so now we need to add boiler repairs to our costs.

Sorry I haven't looked at this thread as been struck with the cold so haven't even entered figures with DH on YNAB yet.

To asnwer some questions above...

The next catelouge I have no outstanding balance I only had 100 on there and paid 50 per month for 2 months.

The food shop does not include wine or fags (we don't drink at home and I am a social smoker so hardly anything there)

Also the 35 pounds is buldings and contents - I was unclear on my list we have just got it down as well

My husband says no to getting rid of virgin as he watches the football, he said he would spend more if he went to the pub which is a fair comment

I am doing my Lidl shop this sat morning there so I shall report back on how I have done!! That is my first step to crack it..

Loving the home fragerance recipe thanks for that!

I have only spent 20 the last 3 days (husband has spent nothing) and we have been to a soft play, got bits for son's packed lunch. Got 34 meatballs cheap in tescos as they were going off that day so that was dinner for 2 nights.

My dad has also come over with two big chickens - from the market.. Not sure about market meat but apparently this guy has been there for years, so it can't be that bad can it?!!!! But I can get a few meals out of that.

Loving the budgeting so far..... I get paid tomorrow and my husband on 31st so we really need to start allocating things for christmas bdays car insurance etc etc which we haven't done at all and which is why its gone tits up.

Loving the support - thanks all!

This is so exciting. Do get YNAB - even the trial version - it really will make it so easy to do, because you can set up a category for Christmas, Birthdays, Car Insurance, etc. and it means that even if you see you have a spare £4.31, you can think 'Oh I'll put that towards the car insurance....' and it's amazing to see how it all adds up.

Then, once you've got into that habit, it will actually feel painful to have to take £20 from your gradual savings towards something, for a takeaway, etc.

Suddenly, when every pound has a purpose, you've got to consciously decide to allocate it to buying that impulse bar of chocolate/cappucino, and you'll find that you prefer the thrill of having savings

Sounds great, thanks lougle! We have downloaded it we just need to sit down and start...looking forward to it!

Once you have done the budget on moneysavingexpert you will see if your expenditure exceeds your income. You will see then that there are areas to cut back on.
If, once you have done that you don't think you can pay off your debts by making the required monthly payments (and stop adding to them) then you will really benefit from going to see a Debt Advisor. Look up Community Money Advice online to find your local free one. They will help you find ways to manage the debts and pay them off so they don't grow. If your debts are growing due to interest etc you and fighting against the tide. You don't need to do it. There are ways to prevent the debts rising.
Don't feel that Debt Advice isn't for people like you. It's not just for the unemployed, those who have been to loan sharks or people on low incomes. Often those on high incomes are most in debt. Part of your overall financial overhaul probably involves talking to one of these experts who are trained volunteer experts who can make a real difference. I know, because I am one of those volunteers and we see people in your kind of position and really can help.

Chocolatewombat - thanks for the great advice which I will definately follow!!

Got a quote today for some lovely shutters for our bedroom. This will have to wait :o(

So did my first Aldi shop today - managed to get all of my usual fruit and veg. X3 packets of free range chicken breasts. Mackrel, salmon, pesto, pasta, chopped tomatos, biscuits flowers, bin bags cleaning products potatos etc....

The only think I was sure of were their beans - are they any good?

Also, their mince didn't look great so didn't get that which I usually do.

Anyway a whole trolley load cost me 77.00 which is amazing. I then went to sainsbury to get the bits Aldi didn't have such as cous cous, I got free range mince and a few bits which came to 30.00.

So a full weekly shop, which could last me at least 1.5 weeks cost: 107.00!!

If I had done same in sainsbury it would have def been 150-180.00 - so I am a convert and need to keep it up.

I just need to get used to Aldi's brands and ull be fine - very happy as I ccould potantially save 200-300 per month yay!!

Well we like the beans but there's only one way to fing out.

Find out.