Should I be more secure?

[NonTraditionalFeelings]

I'm 36, have 3 children and I'm divorced.

Financially I have zero in the ya of savings right now. I did have around 6k but an unscrupulous builder who screwed me over a project has meant that by the time the build is done I will have nothing.

Since getting divorced I've not been in this situation, I've always had money behind me to some degree or another 😭

House wise I have £119k mortgage but once house is done it should be worth approx £250k or maybe a bit more.

I have a workplace pension which was started 3 years ago, a private pension with about £38k in it and obviously my state (if it ever happens) pension.

I have about £600 expendable income a month at the moment but with 3 children this soon dwindles.

I just feel like I need to become more financially stable and have no idea where to start. I have no partner to back me up so it's just me and the kids.

I work full time as it is. In terms of debt I will
probably have about £3k to pay off credit card by the time the build is done (because of the arse builder), no overdraft, student loan of 8k which comes out of my salary.

I just feel like I'm going to be forever stuck with no money now 😫

Life insurance would be your first priority. You will need some to repay the mortgage if you die plus ideally some extra to support the kids until they are financially independent.

You don’t have much debt, what is the interest rate in the credit card? If not 0% see if you can get it moved. Get it paid off ASAP and also start putting something into a savings account as rainy day money / emergency funds. Ideally you should look at 3 x your monthly expenditure as a minimum.

Once that is done, you can look at some longer term savings or increasing your pension contributions.

An IFA would help with the life cover arrangements - working out how much cover and what it would cost. Set
yourself a budget which you can realistically afford. It’s better to have some cover at what you can afford than none at all or trying to cover a higher cost and then not being able to keep it up.

@Mileymileymoomoo yes I've got insurances. I have life insurance and income protection insurance. Credit cards are zero percent as I always move them around.

I'd love to have 3 months worth of expenditure but that's around 8k which is not an easy thing to save up when you have limited funds. Everyone says you need to save but what if you don't have much to save to start with?

You should take an analytical eye to your outgoings.

Are you by habit a frugal spender?

I’d set up a dd taking £100 from your account straight after pay day, and put it in an ISA.
Then look for specific areas to save, phone contracts? Supermarket own rather than brands? Scrap gym membership and do park run instead.

I have about £600 expendable income a month at the moment but with 3 children this soon dwindles

How comprehensive is your budget before the 'expendable £600'?

It could be that there are lots of essentials that you still haven't accounted for, so no wonder it dwindles down to zero.

Or it could be that your budget is bang on and the £600 is simply spending money, and you are wasting it on crap.

Or anything in between.

A decent savings pot is nice to have, but depending on how much genuinely spare money you have or room to cut back, it may or may not be possible.

If you haven't done so already, make moneysavingexpert your friend.

Use the money makeover to maximise your income and minimise your outgoings, increasing the money you have spare to save or spend.

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

Everything you spend see if you can get it cheaper. Make a habit of using vouchers and discount codes. Watch what you spend on food and drink out of the house because this can really add up. The difference between just buying the first thing you see, not shopping around etc and never taking a picnic, compared with shopping around and limiting what you spend on convenience food, cafe lunches etc can be hundreds of pounds a month.

Try to put money aside for annual and irregular expenses and the 'what if' fund before spending money each month. Even if you can only put a little aside, it will add up over time.

@BarbaraofSeville thank you that's really helpful. My budget is pretty accurate. The reality is though that it doesn't factor in things like birthday and other life events.

For instance this month I need to get back to school items for 3 children, I've got some from last year I'm going to reuse but they all need shoes and new dresses/trousers, possibly some shirts as they've outgrown them, I'm also taking them away to my sisters caravan for a little holiday away, it will cost me nothing for the holiday but there will obviously be spending money, my son has also grown out of all his clothes, I've been through this weekend and he has two that fit him (I'm not exaggerating here), so I'm taking him out on Sunday to get some T-shirt's, I'll be shopping at Primark and H&M.

Last month it was my daughter birthday, so cost of presents, she desperately wanted a party and as she's new to the school and has no real friends I couldn't really say no, it was also my nieces 18th, and BOTH of my sisters birthday. Honestly it's crippling some months with these bits of expense. I'm also dreading Christmas. I normally save £100 a month but that is wiped out every Christmas without fail!

It just feels like I'll never get on top of it.

I've been through my expenses and I've changed my gas and electric, can't change water. I've cancelled broadband and moved to another provider, cancelled pet insurance and got a cheaper quote. I overpay my mortgage by £50 a month and I'd like to continue doing so.

I freelance in the evenings so that helps a bit.

I'd also like to add before kids I had about £15k worth of savings!

Insurance renewals are such a bloody scam. We saved money by moving everything.

We do not buy for adults in my family, would that be possible for you?

My budget is pretty accurate. The reality is though that it doesn't factor in things like birthday and other life events

So it's not accurate is it

You have 3 DC, you know that they will be invited to parties, they need new clothes, they will want their own parties, they'll need money for dress up days at school etc, you will spend money on holidays and days out, even if you stay for free in your sister's caravan.

So you need to include these things in your budget - don't worry if the figure isn't 100% accurate, but you need to count something - and if nothing else, you'll not be looking at that £600 thinking 'WTF did I spend that on'?

Things might start looking up once the work on the house stops costing you money, although of course, you need to try and save something in case the boiler breaks etc.

Also think about how much you are spending on gifts, both for your DC and other people. Don't fall into the trap of exchanging with dozens of people - you just end up doing it for the sake of it and are effectively spending money on stuff no-one wants. Try and agree no presents for adults, except maybe immediate family.

And manage your DCs expectations - you don't have to get them enormous piles of presents or everything they ask for and what others get is irrelevant. It's good that they appreciate that they might not be able to have the same standard of living as before as you and your ex H now have to pay for 2 homes out of the same amount of money so spare money for presents has reduced.

Finally, does their DF contribute maintenance for them and have you checked that you are getting all the benefits and help with childcare costs that you are entitled to?

I didn't buy for my sister and her partner last year (non of the adults) and she basically didn't speak to me for 2 months 😔 I've been shouted down numerous times on the no adult gift thing. In total I have 19 people to buy for at Christmas that includes my children so the cost is ridiculous!

Then I would be looking for suitable bargains from now on to give as gifts.

None of the perfect gift for you nonsense!

There is a guide on MSE about how to budget for absolutely everything so I included birthdays Christmas uniforms etc

It’s take a bit of time to set up but once it’s done you can see exactly where you are.

At the end of the day, it’s better save even a little bit if it’s all you can afford than nothing at all.

Great thanks @Mileymileymoomoo I'll take a look.

I would tell other adults that I have no money,don't buy me gifts because I can't afford to buy back.
It may be hard but harder if the boiler breaks and you're all sitting in an unheated house but that's OK because people have presents.
Use all that money to pay off your credit card,then saves little then buy pressies when you can afford to.19 adults is ridiculous.

I wouldn’t be prioritising overpaying the mortgage. It’s a cheap way to borrow money and it is what it is - with a budget as tight as yours, I see no reason to further reduce your circumstances for a far off benefit.

What would you say is an ok disposable income in my circumstances?

19 people is lots of people to buy presents for. Suggest you need to add up & cut down how much you spend

How many adults ?
How many children ?

Do you receive child maintenance ?

You have no savings, but over pay your mortgage
ISAs are tax free, is it better to pay mortgage or save in ISA ?

OP I am in a very similar place to you. As a single parent I now work for a fraction of my salary in a different job three years ago. As my DC get older (teens) and need more (school trips, uniform, music lessons, sport, playdates at cinema, shoes etc) I can't afford it all.
I do receive the bare minimum CM through the service, exh thinks £40.15 per week is all that's required and not a penny more.
In September for the first time I'm going to have to tell both DC that they can't go on their school trips as I can't afford it any more.
I get how you feel, it's so hard to juggle the money every minute/day/week/month.
Best wishes - you're not alone.

You've probably done it already, but if you contact the council they HAVE to offer you the option to pay over 12 months not 10, for no extra charges. It may help a little. And if your DC are old enough I now 'pay' them for jobs, eg. £3 for mowing the lawn etc. This way they can choose to earn a little more, if you can afford it of course. I've found it's resulted in my eldest choosing to spend less when she's out with her friends.

@Teabay thank you for your support and I'm really sorry to hear that you are in a crappy situation too. Thankfully I do receive help from my ex, if I didn't we would be absolutely stuffed. I'd rather not be reliant on his input though, although it's all in writing and court approved till they are
18. People tell me I need to save more but funnily enough these are the people with over £2000k disposable income a month. Easier said than done when you have very little left over.