Help us with our finances please!

[WeNeedABudget]

We’re trying to work off of a weekly cash budget from my partners wages knowing that it leaves my salary in the bank for other things. The budget is around £190 for food, fuel, a takeaway etc. We draw this out in cash leaving fuel money in the bank to pay for by card.

The problem we’re having is that things keep cropping up outwith the normal things we need to week to week eg tickets for a show my daughter is in, costumes for the kids for school etc and because I know my salary is there at the end of the month I’m guilty of just paying for these and this month for example around £700 of my salary is ‘owed to bills’ when it really shouldn’t be. It’s amazing how quickly the £20, £30 spends add up into hundreds.

Does anyone have any advice on how to combat this? To be precise I’ve worked our weekly budget out at £192 so was thinking I could set aside £22 per week to a different account to build up a ‘slush fund’ for these additional expenses. Obviously hoping we have a few weeks without too many to let this rack up!! This leaves £130 after fuel for shopping, a takeaway and anything we need to do at the weekend? Is this realistic? We’re a family of four and I’d say we spend around £70 on food shopping.

Can anyone think of any other way to do this to stop me eating into my salary every month?

Just to add the reason I want to try and leave my salary untouched is because we have some credit card debt I really want to pay off before we remortgage our house to extend.

Budgets don’t include any big one off expenses like Christmas, big car expenses, birthdays etc which I know is a huge downfall but I’ve always been a bit wary of committing to saving for these because it eats into either the weekly available spending money or my monthly salary. But I know that not accounting for these things means the whole thing is pointless really isn’t it? Short term sacrifices for long time gains.

I’d bet that most if the credit card debt you’re trying to clear is probably from not budgeting for Christmas, birthdays, car expenses etc.

The point of budgeting really is to work out your priorities, which just means the stuff you absolutely will spend money on come what may, regardless of whether you have the cash stashed. Not the things you think you should spend on, the things you will.

So if you don’t have money saved for Christmas you WILL buy the kids presents, cos you can afford them on a credit card and you earn a decent salary so you’ll just pay it off over a couple of months. You WILL fix the car, because who doesn’t? Again, you can use the credit card. In my house if the big TV broke my DH WOULD order a new one straight away and not save up and manage whilst we did so etc. I might prefer he’d manage & save up, but I know that is not going to be the case so I’d better have a new-TV-sized savings buffer, just in case, unless we want to go into debt.

Putting stuff in credit seems OK in the short term but because no month is ‘normal’ you never catch up, let alone get ahead. (Jan, car tax & insurance; Feb, DC1 birthday; Mar, pay holiday deposit & boiler needs fixing; Apr, DC2 birthday & Easter holiday childcare etc, you get the picture).

So you have to save up for the ‘known’ stuff AND get a buffer for the unknowns or all you’re really doing is paying off the same £700 on the credit card over and over and over...

@NoSquirrels that is excellently put. Especially the bit about accepting the reality that your household WILL spend on x and y that you'd rather not!
OP you are quite right, there's no point in a budget that ignores the annual/occasional costs, as you will NEVER catch up with yourself that way.

Agree with others. @NoSquirrels has explained it really well.

You can't have a successful budget if you are ignoring some of your expenses.

So do I just think of all the big things that crop up and divide them by 12? I think this will need to come out of my salary rather than my partners weekly wages. It’s such a scary thought because I could potentially be committing hundreds per month to these things but I understand they WILL HAPPEN whether I want them to or not.

Paying off the same £700 on a credit card over and over again I can hugely relate too! We always get it paid down a bit then add something else on and while I don’t think we’re at panic stations yet with the card - if we don’t do something about it now we really could be very soon.

Great ideas on the takeaway front too. Particularly the M&S one. Love a dine in deal.

Your username makes me think you may already have tried out/investigated YNAB (You Need A Budget)? I think it would really help you in your particular situation and allow you to keep the money in the bank & spend your DP’s wages as ‘cash’.

It does have a bit of a learning curve to wrap your head around but that’s not because the app is complicated- it’s not! - it’s getting the mental adjustment of how you budget. Look at Nick True videos on YouTube about YNAB, he explains it very well.

If you want to do it without any extra software then just set up a spreadsheet, figure out all your costs (annual, bi-annual, infrequent, etc) and divide by 12 and keep that money aside every month. Then you’ll see how much you can really send to pay the credit card every month (sadly, always much less than you think!)

Sorry, replying to my own post! But I’ve got a real-life for instance happened this week in our house.

DH’s birthday next year a comedian he REALLY likes is booking now near his birthday. Great, I say - money not saved up but we’ll put it on the credit card and it can be your birthday present. We can float that.

Same time I know we need to potentially pay a family member a deposit on a holiday booking - not sure yet how much but is a priority so we’d need spare cash for that.

Our income is sometimes variable depending on freelance work.

Two days after the comedian booking, a once-in-a-might-never-recur opportunity comes up that my DH REALLY REALLY wants. Like, REALLY REALLY would swap the comedian wants. So, we probably can’t afford that, right? Timing sucks, etc. If we put it on credit then who’s to say in another 2 weeks something else might not come up that’s “unmissable”.

But because we’ve saved up money towards some of the holiday stuff every month (albeit it’s low right now since summer just over), and because we can lower the 0% debt repayment this month (and catch up in time) and because we can juggle some funds around that are saved for costs 5 months’ down the line, we can squeak it.

DH already looking for extra freelance to cover it, and we’ll go no-spend on eating out/takeaway/frivolous groceries.

It’s not ideal, perfect, have-all-the-cash-right-here-right-now budgeting, but it is considered, we have a plan and it’s worth it to us (DH!!)

As opposed to ‘Fuck it, let’s do it and worry later, it’ll all be OK’, which is where that £700 over and over gets you.

So do I just think of all the big things that crop up and divide them by 12?

Well, yes. That is exactly how budgeting works.
It is what I keep trying to explain to my (adult) ds when he gets hit with a bill for his car. That he needs to pt £200 per month into a savings account on payday, every month, towards car expenses. Then, when your exhaust drops off, and you get a puncture in the same month, the money is there, ready. If you are lucky enough not to have to pay out for 8 months in a row, then you've got a nice little amount saved towards your next car, or towards your insurance or, once you get a sizeable amount, you can move it somewhere else for whatever else you might be saving towards.
You can't ignore the fact you WILL have to pay for things that don't come along n 12 neat little monthly payments.

Yes,totally what the others have explained. I don't use anything complicated - notebook for tracking day to day, month by month, and regular checks of online banking. I have DDs set up straight payday into savings, and labelled "Car" or "Dental" or "Christmas" or whatever, so although they all go into the same savings account it's easy to see what the amounts per category saved are, through the year.

I did look at YNAB but decided my financial life wasn't complicated enough to warrant it - just one income (singe parent). I do have 3 separate savings accounts though, so I have current account, then 1 savings ac for DC (pocket money or relatives' gifts go in there), 1 savings ac for everything routine and predictable (insurance, car service, Christmas, holiday outings...) and 1 more savings ac for a particular big expense that has just started and I need to keep a very close eye on putting enough aside for it.

I did look at YNAB years ago but don’t really remember the set up of it.

Got a Monzo card a few weeks ago but haven’t used it yet so think I’ll start putting money into it instead of withdrawing cash. You can set up different pots on there so I think I’ll set one each for all these big things we’ve discussed and save that way. I’m dreading actually writing everything down and splitting it up but I have no other option.

then remembered I’m sponsoring the kids and need £20 for that so straight away it’s gone. This is the kind of thing that’s holding us back

It’s not holding you back. It’s the life you’re in at the moment on the income you have.

Sounds to me that you’re careful and pretty frugal with expenditure so maybe continue in that vein setting aside what you can and instead look for ways earn more.

I received a salary increase of £12k a year ( I was offered another job and this was what the offered me to stay) and it made a real tangible difference that no amount of little tweaks to expenditure could have done to my savings.

That’s a really great point. I have considered a second job but my partner works really erratic hours so I don’t think it would be possible for me. I do think my partner could ask for a pay rise though which might get us an extra few pounds per week for these little costs.

I’m so jealous of that pay rise! That’s amazing. Bet that changed so much for you.

If you really struggle with meal planning I'd probably accept that one night a week is going to be beans or egg on toast night. And then for another you could grab something like a rotisserie chicken, a bag of salad and some bread on the way home, or similar. Healthier convenience food basically, and cheaper than a takeaway.